2. Suppose John's utility function is UX,Y) = 4VXY , where X is consumption of beer and Y is consumption of pizza. For this utility function, ( Calculus Kahuna say: MUx = 2VY/X and MUy = 2X/Y ) a) Suppose Y=3. Calculate John's utility for X=4,9,16, and 25. For a given level of Y, does good X display diminishing marginal utility?

Microeconomic Theory
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ISBN:9781337517942
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Chapter3: Preferences And Utility
Section: Chapter Questions
Problem 3.2P
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2. Suppose John's utility function is UX,Y) = 4/XY , where X is consumption of beer and
Y is consumption of pizza. For this utility function,
( Calculus Kahuna say: MUx = 2Y/X and MUy = 2\X/Y )
a) Suppose Y=3. Calculate John's utility for X=4,9,16, and 25. For a given level of
Y, does good X display diminishing marginal utility?
Transcribed Image Text:2. Suppose John's utility function is UX,Y) = 4/XY , where X is consumption of beer and Y is consumption of pizza. For this utility function, ( Calculus Kahuna say: MUx = 2Y/X and MUy = 2\X/Y ) a) Suppose Y=3. Calculate John's utility for X=4,9,16, and 25. For a given level of Y, does good X display diminishing marginal utility?
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