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Adi maximizes his utility by consuming goods x and y and his utility function is given by: Max U =x + y x.y Adi has a budget of 200, while the prices of good x and y are 20 and 10, respectively. However, the department store limits the number of good x that might be purchased, i.e. the maximum purchase of x is only 8 unit. Therefore, the budget set of Adi is B: 20x + 10y < 200 and x <8; dan x, y 2 0

Adi maximizes his utility by consuming goods x and y and his utility function is given by: Max U =x + y x.y Adi has a budget of 200, while the prices of good x and y are 20 and 10, respectively. However, the department store limits the number of good x that might be purchased, i.e. the maximum purchase of x is only 8 unit. Therefore, the budget set of Adi is B: 20x + 10y < 200 and x <8; dan x, y 2 0

Algebra for College Students
Algebra for College Students
10th Edition
ISBN:9781285195780
Author:Jerome E. Kaufmann, Karen L. Schwitters
Publisher:Jerome E. Kaufmann, Karen L. Schwitters
Chapter12: Algebra Of Matrices
Section12.CR: Review Problem Set
Problem 37CR
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Draw and verify whether Adi’s budget set is an B Open set? Closed set? Bounded set? and/or Compact set? (Hint: draw the budget line and purchase constraints in a single cartesian diagram and identify the area that satisfies both constraints as a set, then analyze!)

Adi maximizes his utility by consuming goods x and y and his utility function is given by: Max U =x + y x.y Adi has a budget of 200, while the prices of good x and y are 20 and 10, respectively. However, the department store limits the number of good x that might be purchased, i.e. the maximum purchase of x is only 8 unit. Therefore, the budget set of Adi is B: 20x + 10y < 200 and x < 8 ; dan x, y > 0
Transcribed Image Text:Adi maximizes his utility by consuming goods x and y and his utility function is given by: Max U =x + y x.y Adi has a budget of 200, while the prices of good x and y are 20 and 10, respectively. However, the department store limits the number of good x that might be purchased, i.e. the maximum purchase of x is only 8 unit. Therefore, the budget set of Adi is B: 20x + 10y < 200 and x < 8 ; dan x, y > 0
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