A consumer has GH¢600 to spend on two commodities, A and B. Commodity A costs GH¢20 per unit and Commodity B costs GH¢30 per unit. Suppose that the utility derived by the consumer from x units of Commodity A, and y Commodity B is given by the Cobb-Douglas utility function U (x, y) = 10x0.6y0.4 a. How many units of each commodity should the consumer buy to maximize utility? b. Is the budget constraint binding?

Q: Q10. Consider a utility function: U (F,C) = FC so MU_F = C and MU_C = F. In Case 1, Total income is…

A: We are going to use Consumser decision theory to answer the question.

Q: Suppose a consumer has an income of $120, the price of good X is $24 per unit and the price of good…

A: The marginal utilities will look like: Consumer's utility maximizing bundle is where: MUxPx=MUyPy…

Q: Assume that Rossi consumes only bananas and avocado. Fortunately, she likes both goods. The…

A: At optimal condition MRS = Price ratio.

Q: Answer the question based on the table below showing the marginal utility schedules for product X…

A: Utility-maximizing combination: A firm maximizes its utility combination where the marginal utility…

Q: To remain in consumer optimum, a price decrease requires V in consumption. A price increase requires…

A: To remain in consumer optimum, a price decrease requires an increase in consumption. A price…

Q: Troy has preferences for laptops (L), and drones (D). Laptops costs $750 a unit and drones costs…

A: Given information- Laptop Cost $750 Drone Cost- $2000 Total Cost- $15000

Q: Rita has a budget of £600 to spend on theatre tickets (X) and on restaurant meals (Y). Each theatre…

A: Since you have asked multiple questions, we will solve Part (c) and (d) for you.  Given,  The…

Q: Juliana gets the following 15 units for free if she buys 30 units of good Y (at RM2 per unit). This…

A: The equation of the budget line procedure hinges on the prices of goods and the income of customers.…

Q: Irene spends all of her income M on soda and chips. The price of soda is 2 per unit. Irene’s utility…

A:

Q: Consumer spends $450 per week on two goods, X and Y. PX= $5 and PY=$3. His utility function is U=…

A: Consumers behavior is inclined towards utility maximization, whereas producers behavior is inclined…

Q: Consider the Cobb-Douglas utility function of a consumer is given as u (z y) := 1"y where a > b and…

A: Given; Utility function; u(x,y)=xaybwhere;a>b and  the sum (a, b) and the product (a,b) are 1 and…

Q: Troy has preferences for laptops (L), and drones (D). Laptops costs $750 a unit and drones costs…

A: GIVEN DATA   Troy has preferences for laptops (L), and drones (D). Laptops costs $750 a unit and…

Q: Suppose that a consumer with the utility function U = X0.75 Y 0.25 choses a bundle where X=10 and…

A: According to the given question, the utility function is given as U=X0.75Y0.25 With the bundle…

Q: Why the following variables (x1, x2 and x3) cannot be the Marshallian demand functions of a consumer…

A: The Marshallian demand function is exclusively the ordinary market demand function we have been…

Q: Consider the following utility function: U = 4X + Y. A consumer faces prices of P, = $2 and Py =1.…

A: Answer: A consumer maximizes his/her utility where the following condition satisfies:…

Q: Suppose that a consumer with the utility function U = X0.75 Y0.25 choses a bundle where X=10 and…

A: Marginal utility per dollar is the ratio of marginal utility to the price of the good. It increases…

Q: Diogo has a utility function, U(q1, 92) = 91 0.8 0.2 92 where 91 is chocolate candy and q, is slices…

A: Lagrangian multiplier can be used to optimize an objective function subject to a particular…

Q: consumers pay

A: Marginal rate of substitution: It refers to the buying capacity or willingness of the buyer to buy…

Q: As Lynn eats more pizza, we would typically expect her marginal utility from eating pizza to:

A: Marginal utility, in economics refers to the satisfaction that is gained by a consumer after…

Q: Diogo has a utility function, U(a,, 92) =q, 02., 0.8 where q, is chocolate candy and q2 is slices of…

A: Optimal condition is that condition where MRS is equal to price ratio.

Q: Given a utility function that represents preference over bundles which consists of two goods. Can we…

A: To analyze consumer behavior and their satisfaction from the consumption of goods and services,…

Q: Suppose that a consumer with the utility function U = X^.75 Y^.25 choses a bundle where X=10 and…

A: Utility function: The utility function is a key concept in economics that assesses preferences…

Q: Consumer spends $450 per week on two goods, X and Y. PX= $5 and PY=$3. His utility function is U=…

A: Given,  U= 0.5xy2

Q: A consumer is currently purchasing three pairs of jeans and five T-shirts per year. The price of…

A: A rational consumer would always aim at maximizing his/her utility. So a consumer would choose the…

Q: A consumer consumes two goods and her utility is form by Cobb-Douglas utility function. Her MRS is…

A: A rational consumer utility is maximized at a point where the slope of the budget line is equal to…

Q: Q1) For the utility function in part a below, draw a set of indifference curves showing utility…

A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…

Q: Two individuals, Amir and Budi, consume two goods, clothes (X) and shoes (Y). The utility functions…

A: Given the two good and two consumer economy: Utility function:  For Amir (A): UA= 15XA0.25YA0.75 For…

Q: Casper consumes cocoa and cheese. Cocoa is sold in an unusual way. There is only one supplier, and…

A:

Q: Miss Coco consumes cheese cake and curry puff. Her consumption yields the following total utility as…

A: Given; Price of cheese cake= RM8 Price of curry puff= RM4 Income; M= RM52

Q: Suppose a consumer has a budget of $200 to spend on two goods, X and Y, whose prices are $20 and…

A: Answer: Given, Total budget = $200 Price of good X PX=$20Price of good Y PY=$10 (d). A consumer is…

Q: Suppose Mary has the utility function U(x1, x2) = v(x;) + 2x2 with v such that v' > 0 and v" < 0.…

A: Given, Utility Function, U(x1,x2) = v(x1)+ 2X2, v such that v'&gt;0 and V"&lt;0 As mentioned, x1 =…

Q: Praxilla who lived in ancient Greece derives utility from Reading poems and from eating cucumbers.…

A: Marginal utility (MU)  is the additional gain that is derived by consuming an additional unit of a…

Q: A consumer has GH¢600 to spend on two commodities, A and B. Commodity A costs GH¢20 per unit and…

A:

Q: Bob lives in San Diego and loves to eat desserts. He spends his entire weekly allowance on pudding…

A: Marginal rate of substitution can be explained as the rate at which a consumer is willing to give up…

Q: Suppose the weighted marginal utility for two goods, x and y, at a position of consumer equilibrium…

A: Here, weighted marginal utility is given as 70 at equilibrium, it implies that MUm is equal to 70.

Q: Diogo has a utility function, 0.2. 0.8 where q, is chocolate candy and q2 is slices of pie. If the…

A: The measure that illustrates satisfaction or welfare of a consumer being a function of the real good…

Q: Miss Coco consumes cheese cake and curry puff. Her consumption yields the following total utility as…

A: The entire satisfaction gained from the consumption of an item or service is referred to as utility…

Q: Tina consumes only two goods , x and y, and her utility function is u(x1,x2) = x12+x22. (1) Find…

A: Given utility function is u(x1,x2) = x12+x22

Q: A consumer has S600 to spend on good x and y. Her preferences can be represented by the utility…

A: U(x,y)=100lnx+y Px=$10 Py=$5 M=$600 Optimal bundle is obtained when marginal utility per dollar of…

Q: U = U ( x 1, x2)  = (x1 + 2) 2 (x2 + 3) 3

A: The Marginal utility is a satisfaction which consumer derive by consuming one more unit of…

Q: A consumer is in equilibrium and is spending income in such a way that the marginal utility of…

A: A person can maximize his utility at the point where the marginal utility per dollar derived from…

Q: Explain whether the following statement is true, false, or uncertain. A consumer consumes two…

A: In a market, if the goods are complements like butter and jam, then a increase in price of bread…

Q: Linguini and Colette consume only éclair (x1) and profiterole (x2). Linguini has utility function UA…

A:

Q: Given Utility function U=20Q-2Q^2, what quantity of good gives highest utility for the consumer?…

A: The utility (U) for a consumer is the amount of satisfaction procured or attained by an individual…

Q: In 2005, suppose a typical U.S. owner of a home theater (a television and a DVD player) bought 8…

A: Here we have:- Cobb-Douglas utility function=Uq1,q2=q10.2q20.8 Here Barbara spent spent $600 so, the…

Q: Mrs. Simpson buys loaves of bread and quarts of milk each week at prices of $1 and 80 cents,…

A: Utility of a consumer is maximized when the consumer allocates the budget in such a that the last…

Q: Amrita, a utility maximizing consumer, consumes only two normal goods, Breakfast Cereal and Bread…

A: Marginal utility refers to the value of additional utility that derived from the consumption of one…

Q: Find the maximizing utility for the person consuming two commodities from the following information:…

A: Answer - Total Utility -  It is the total satisfaction received by consuming by a given total…