What is the marginal rate of substitution (MRS) for the utility function U(x, y) = x² + y²? The marginal rate of substitution of good x for good y is MRS = (Properly format your expression using the tools in the palette. Hover over tools to see keyboard shortcuts. E.g., a superscript can be created with the character.) (Note: Be sure to use the Greek letter rho provided in the tool palette in your response.)

What is the marginal rate of substitution (MRS) for the utility function U(x, y) = x² + y²? The marginal rate of substitution of good x for good y is MRS = (Properly format your expression using the tools in the palette. Hover over tools to see keyboard shortcuts. E.g., a superscript can be created with the character.) (Note: Be sure to use the Greek letter rho provided in the tool palette in your response.)

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter4: Utility Maximization And Choice

Section: Chapter Questions

Problem 4.13P

See similar textbooks

Similar questions

Can you explain why taking a monotonic transformation of a utility function doesn’t change the marginal rate of substitution?
How do we find Substitution effect and Income effect in this equation?
Please answer this question with steps thank you
Given U(c, t)=3c+4t expalin what the utility function says about the marginal rate of substitution.
Suppose Ed's utility from the consumption of martinis (m) is proportional to the number he drinks: U(m) = m. Further, Ed is particular about his martinis: He enjoys them in exactly three parts of gin (g) to one part vermouth (v). So we can write the utility as: U(m) = U (g, v) = min (g, 3v). (a) Provide a sketch of Ed's indifference curve in the (g, v)-space for various level of utility. (a) Let the prices be p, and p, and Ed's income be I. Find the demand functions for 9 and v [Hint: Use the proportional rule and budget constraint. No need for differential calculus] (b) Using the results in (b), what is Ed's indirect utility function? (c) Find the expenditure function; given a level of utility U, and prices pg and Pv.
Calculate marginal utility and marginal utility per dollar for the data provided in the table below: (round to two decimal places) The Price of wine is 4 The Price of Cheese is 0.58 The Consumer's budget for wine and Cheese is 14.91 GLASSES (WINE) (WINE) WEDGES (CHEESE) TOTAL UTILITY OF WINE TOTAL UTILITY (WINE) MARGINAL UTILITY/dollar MARGINAL UTILITY OF CHEESE 1 60 15 Number Number 144 2 45 55 Number 199 56 Number Number 4 252 65 51 Number 5 303 73 The Quantity of Wine this consumer would buy to maximize utility is: Number The Quantity of Cheese this consumer would buy to maximize utility is: Number What is the consumer's Total Utility when optimized: Number 2 3 3 A 5 (CHEESE) MARGINAL UTILITY Number 11 Number 8 (CHEESE) MARGINAL UTILITY/dollar Number Number Number Number
Number of Sodas per day Total Utility Marginal Utilit 1 20 35 3 47 12 4 10 Refer to the table, The marginal utility of the second soda per day is L. (Answer should be in the form of numerical characters, e.g. 20) Enter your answer here
Calculate marginal utility and marginal utility per dollar for the data provided in the table below: (round to two decimal places) The Price of wine is 3 The Price of Cheese is 0.14 The Consumer's budget for wine and Cheese is 9.69 (WINE) (WINE) (CHEESE) (CHEESE) (CHEESE) GLASSES (WINE) WEDGES OF WINE MARGINAL OF CHEESE TOTAL UTILITY MARGINAL UTILITY MARGINAL TOTAL UTILITY MARGINAL UTILITY UTILITY/dollar UTILITY/dollar 1 70 10 Number Number Number Number 35 160 6 Number 65 Number 225 3 41 Number Number Number Number 4 45 4. 288 Number 61 Number 48 349 The Quantity of Wine this consumer would buy to maximize utility is : Number Number The Quantity of Cheese this consumer would buy to maximize utility is : What is the consumer's Total Utility when optimized : Number
Learning Journal prompt: For Unit 4 Learning Journal, you will use the marginal utility formula to choose between two products. Catherine is having dinner at the Yellow Restaurant. She wants desert after eating her entree. She is trying to decide between a cookie or a slice of pie. The cost of a cookie is $5 and the cost of a slice of pie is $8. Refer to the Unit 4 Learning Journal Marginal Utility spreadsheet Compute the marginal utility for cookie and slice of pie Compute the marginal utility per dollar What is the utility maximizing choice for a cookie and slice of pie? Explain what the utility maximizing choice means. Discuss how you could use marginal utility to make consumer choices
Disscuss the Marginal rate of substitution
With diminishing marginal utility, how do consumers decide how much to consume? Students are expected to give a detailed answer to this question. You must include an explanation about what diminishing marginal utility means in your answer. Concepts such as "budget constraint", "more is better", "utility". "marginal utility", and "marginal utility per dollar spent" must be used in your answer. No graph or calculation is required in this question.
Describe the equilibrium conditions in consumer theory (utility maximization) and in production (output maximization). How are they similar? Briefly talk about the duality between production and cost. (Don't forget to talk about law of diminishing MU, diminishing MRS, diminishing MPs and diminishing MRTS. Clearly define each concept with examples. Make sure to define budget and cost constraints. Indifference curves and isoquants. Graphically derive the equilibrium conditions. Make sure to talk about how output maximization and cost minimization lead to the same maximizing/minimizing input bundles. )