4. Depict in separate graphs indifference curves for the following utility functions i. U(¤1, x2) = min(x1, x2) ii. U(x1, x2) = max(x1, x2) iii. Are the goods in both cases substitutes or complements?

Q: Suppose that Kat likes arrows and food. Kat's potential indifference curves for these two goods are…

A: Answer: The assumptions of the indifference curves are as given below: (1). Indifference curves are…

Q: (iii) Find the marginal utilities of x1 and x2 for each utility function (a) V = x1?x2? (b) W = log…

A: The utility function is used to represent the preferences of the consumer and it shows the total…

Q: Q2.  Lucas likes lemon soda (X) and chips (Y). His utility function is given by: U (X, Y) =…

A: U(X,Y)=X0.2Y0.8 I=$40 PX= $2 PY= $4

Q: 3. A consumer's original utility maximizing market basket of goods is shown in the figure as Bundle…

A: FOLLWOWING THE PRICE CHANGE THE BUNDLE MOVES FROM BUNDLE 1 TO BUNDLE 2

Q: Assume that Talib has well-behaved preferences and consumes hamburgers (vertical axis) and steak…

A: When the price(P) of a normal good(here, steak) falls, its quantity demanded rises. It can be split…

Q: Use the following information to solve the next two questions: Suzette's preferences for x1 and x2…

A: The indifference curve of the consumer shows all the combinations of two goods that give an…

Q: A consumer has the utility function U(x1,x2) = min{2x1,x2} and an income of $200. Initially, the…

A: For a fixed proportion utility function, utility is maximized when 2x1 = x2 Plugging in generalized…

Q: Lou's preferences over pizza (X) and other goods (y) are given by U(X,Y)=XY^2 with associated…

A: Utility:The utility is the power or capacity of the goods and services to satisfy human wants, it is…

Q: consumers view 100 quires of paper (each quire contains 25 sheets) and a bale of paper (each bale…

A: Given that the consumer has two different commodities: a bale of paper and 100 quires.

Q: Suppose Ming spends his entire income on two goods, X and Y, has "standard-looking" indifference…

A: We have two goods X and Y where price of good X falls

Q: Q.4. Compare the following two pairs of goods: • Coke and Pepsi • Racket and Shuttle a) In which…

A: The budget constraint of the consumer shows all the different combinations of two goods a consumer…

Q: Suppose that you have an income of $20 to spend on sticky hands and gumballs. Both cost $1.00.…

A: Answer: The new budget constraint is given below: Let the sticky hands is shown on y-axis and…

Q: Mr. Hasan purchases two goods, X and Y, and the utility gained for the last unit purchased of each…

A: Consumer equilibrium- A rational customer would buy something up to the point that the price of the…

Q: 8. If two goods were perfect substitutes of each other, it necessarily follows that A. O An…

A: If two goods were perfect substitutes of each other, it necessarily follows which situation

Q: Consider the following 6 utility functions: U1 = /x + 2y U2 = v2x + Jy U3 = 2x2 + y? + Jy U5 =…

A: *Hi there as you have posted multiple sub parts , as per our guidelines we will only first three .…

Q: Q2. Thirsty Ed drinks only pure spring water, but he can purchase it in two different-sized…

A: A perfect substitute may be utilized in the same way that the item or service it replaces can be…

Q: 2) Suppose a consumer has the budget constraint y = p1x1 + P2¤2, where y is income, x1 and x2 are…

A:

Q: Suppose Ming spends his entire income on two goods, X and Y, has "standard-looking" indifference…

A: An indifference curve is a graphical representation of the level of utility that a consumer derives…

Q: John considers oranges (R) and mandarins (M) as perfect substitutes. He gets the same utility from…

A: Given  Orange (R) and Mandarins (M) are perfect substitutes good for John. He gets the same level of…

Q: Consider a utility function u(x, y) = *y, where 0 0. %3D 1. Derive the marginal utility of x and the…

A: (1) u = (1/2)xayb Differentiate u w.r.t x to get MUx MUx = du / dx => MUx = (a/2)xa-1yb…

Q: Jess is an artist and spends all of her income on pen and pencils. Pen costs $4 per piece and pencil…

A: Jess is an artist and spends all of her income on pen and pencils. As given price of pen is $4 per…

Q: Compare the following two pairs of goods and answer the following questions about complements,…

A:

Q: P Question 1 Anand has $100 to spend on apples and/or avocados. Suppose you have drawn his budget…

A: Correct answer "none of the above".

Q: 2. Indifference curves are convex to the origin because A. O Two goods are perfect substitutes B. O…

A: Indifference curve shows the combination of two goods which give equal amount of satisfaction to the…

Q: 4. Below is the Slutsky substitution matrix for a consumer endowed with locally non-satiated and…

A: The Slutsky matrix work is the vital item in near statics examination in buyer hypothesis. It…

Q: Referring to the graph below (Figure 2) showing a consumer's initial budget line (labeled BO and new…

A: Given graph

Q: 5. Find the optimal bundle using the following utility functions and budget constraints. 1. U(x,…

A: To find the optimal bundle, one need to equate the ratio of utility of two goods to the ratio of…

Q: Answer the next questions on the basis of the following marginal utility (MU) data for products X…

A: Equilibrium is given by  MUx/ Px = MUy /Py

Q: Questions 5 (Demand). The following graph displays Adam's consumption point at a certain level of…

A: The consumers are the entities who tend to consume the goods, services, and other products produced…

Q: The utility function is x+min(6.y). Income is 12, price of good x is 3. Price of good y decreased…

A: SUBSTITUTION EFFECTS- It means the change in the number of goods with respect to a change in the…

Q: 1. Graph a typical indifference curve for the following utility functions and determine whether they…

A: Law of diminishing marginal utility states that every additional unit consumed provides lesser and…

Q: Suppose Ming spends his entire income on two goods, X and Y, has "standard-looking" indifference…

A: The intermediate or final process through which institutional entities consume things or services is…

Q: 10. Assume an individual's preferences are represented by the following indifference map and he has…

A: Income = 400  Price of Good1 = $20 Price of Good 2 Originally = $10 Price of Good 2 Changes to = $16…

Q: 3. Suppose Product X is a normal good and its price (Px) decreases. Graphically illustrate its…

A: Normal goods are those goods whose demand and income moves in same direction. If income rise then…

Q: 16. Linda consumes two goods: x and y, has preferences that are smooth (utility maximi zation is…

A: Marginal rate of Substitution: In economics, the marginal rate of substitution states the point at…

Q: Answer the attached question

A: Substitutes goods are used in place of each other while complement goods are used together.

Q: Suppose that Sam has a utility function u(x, y)= x+y where x is the amount of good 1 and y is the…

A: The change in demand due to change in the rate of exchange is called Substitution Effect on the…

Q: PROBLEM You are choosing between two goods, X and Y, and your MU from each is shown in the table…

A: Px=2 py=1 P'x=1 I=9

Q: 13. Sylvester has an income of $110 that he spends on two goods: X and Y. The price of a unit of Y…

A: Given; Income; M= $110 Price of Y= $5 Price of first four unit of X= $14 Price after fourth unit of…

Q: Suppose that a consumer with the utility function U X=5 and Y=10. If the prices of the two goods are…

A: U=X0.25Y0.75 Differentiate U w.r.t X to get MUx MUx = dU /dX => MUx = 0.25 (Y/X)0.75 Put X=5 and…

Q: 4. Emma consumes apples and bananas only. Her utility function is given by u(XA,XB) = XAXB. The…

A: a. Budget line equation I = (PXA)XA+ (PXB)XB 40 = 1XA + 2XB            ................ (i) The…

Q: 4- An indifference curve connects points on a graph representing different quantities of two goods,…

A: Microeconomics studies the economic behavior of the individual units such as a buyer, a seller, a…

Q: 10. Assume that a consumer's income is high enough so that with quasilinear preferences, her demand…

A: Price Effect/ Total Effect: The price effect refers to the change in demand of a good due to a…