6. A firm's demand function for a certain good is given by P = 100e0.10 . Its total cost function is TC =100e0.10 What output level maximizes the firm's profit? +50. %3D 7. An individual's utility function is given by U =1000x, +450 x, +5x,x, -2x -x | where x, is the amount of leisure measured in hours per week and x, is income earned measured in cedis per week. Determine the value of the marginal utilities, when x, = 138 and x, = 500. Hence estimate the change in utility if the individual works for an extra hour, which increases earned income by GH¢15 per week. Does the law of diminishing utility hold for this function?

6. A firm's demand function for a certain good is given by P = 100e0.10 . Its total cost function is TC =100e0.10 What output level maximizes the firm's profit? +50. %3D 7. An individual's utility function is given by U =1000x, +450 x, +5x,x, -2x -x | where x, is the amount of leisure measured in hours per week and x, is income earned measured in cedis per week. Determine the value of the marginal utilities, when x, = 138 and x, = 500. Hence estimate the change in utility if the individual works for an extra hour, which increases earned income by GH¢15 per week. Does the law of diminishing utility hold for this function?

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter18: Asymmetric Information

Section: Chapter Questions

Problem 18.3P

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