.5 .5 Suppose you have the utility function U(x, y) = X +y. The price of good x is $10 and the price of good y is $1. The consumer has an income of $110. Solve for whether there is diminishing marginal utility with respect to each of the goods, whether the preferences that are represented by the utility function are strictly convex, and also solve for the demand functions for x and y.
.5 .5 Suppose you have the utility function U(x, y) = X +y. The price of good x is $10 and the price of good y is $1. The consumer has an income of $110. Solve for whether there is diminishing marginal utility with respect to each of the goods, whether the preferences that are represented by the utility function are strictly convex, and also solve for the demand functions for x and y.
Chapter7: Consumer Choice: Maximizing Utility And Behavioral Economics
Section: Chapter Questions
Problem 3WNG
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