Consider the utility function of individual A given by UA (X,Y) = X0.5yo.s in answering the items below: Calculate the marginal utility for each good (MU, & MU,) of individual A and the marginal rate of substitution (MRSXY). Interpret your computed values

Q: Which one of the following statements is definitely correct for the marginal rate of substitution…

A: Monotonic preferences are ones in which having more is always better. If bundle x has more of every…

Q: Calculate the marginal rate of substitution (MRS12) for the following utility function: U(91,92)…

A: Marginal rate of technical substitution is the rate at which one input is the substituted for other.

Q: Clara's utility function is U(x, y) =(x+2)(y+1). If her marginal rate of substitution is -4 and she…

A: Marginal rate of substitution is the rate at which one good is substituted for other. It is the…

Q: Consider a consumer whose preferences are represented by the utility function u(x,y)=xy (Marginal…

A: Utility is the function of the goods which consumer prefers to consume Here U=f(X,Y) Given Marginal…

Q: Suppose Pizza (P) and Hamburgers (H) are perfect substitutes to Kate. Two slices of Pizza always…

A: Given  Pizza (P) and Hamburgers (H) are perfect substitute  and utility from 2 slices of Pizza =…

Q: For the utility function U(X,Y)= 6X0.50.5, the marginal rate of substitution MRSxy is: O Y/X. O X/Y.…

A: Given:- Utility function, U(X,Y)=6X0.5Y0.5 To calculate:- MRSxy=?

Q: Suppose that the following utility function is given U(X,Y) = x +Y. Which of the following is…

A: D) We have non-convex preferences since Law of diminishing Marginal Rate of Substitution fails to…

Q: Compute marginal utilities and marginal rate of substitution for each of the utility functions given…

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Q: Compute marginal utilities and marginal rate of substitution for each of the utility functions given…

A: The function which helps in measuring the satisfaction or welfare of a consumer as being consumption…

Q: Given the indifference curve shown to the right: Q 10- a. What is the marginal rate of substitution…

A: * answer :-  * a) Marginal Rate of Substitution = Change in good Y ( books)/ change in good X( CD)…

Q: What condition should be met in order for the consumer to maximize satisfaction in the consumption…

A: Consumer Utility Maximisation - Utility maximisation is an important concept in microeconomics. It…

Q: Mrs. Griffiths earns $5000 a week and spend her entire income on dresses and handbags. Since these…

A: The budget constraint shows the combinations of two goods that an individual is able to purchase…

Q: A student living in a university hostel has two options for meals: eating at the dining hall for…

A: Budget constraint: - it is graphical representation of different bundles of goods that a consumer…

Q: A consumer's utility function is given by the expression: U = (0.6x*s + 0.4Y*s)*. • Determine the…

A: Since you have posted a question with multiple sub-parts, we will solve the first three subparts for…

Q: The marginal utility for the third unit of X is 60 utils, and the marginal utility for the fourth…

A: The law of diminishing marginal utility states that  as consumer consumes more and more of a good,…

Q: If the price pf pasta increases and a consumer buys more pasta, we can infer that  a. pasta is a…

A: If the price pf pasta increases and a consumer buys more pasta, we can infer that  a. pasta is a…

Q: The marginal rate of substitution is the maximum number of units of good Y that the consumer would…

A: Option -: All of the above is correct The marginal rate of substitution is defined as the…

Q: Calculate the marginal rate of substitution (MRS12) for the following utility function: U(q1, 92) =…

A: "Marginal rate of substitution indicates the rate at which a consumer can give up some units of a…

Q: Mrs. Griffiths earns $5000 a week and spend her entire income on dresses and handbags. Since these…

A: The indifference curve shows the combination of two goods and services that gives the same…

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: A consumer’s utility function is given by the expression:  ( ) 2 0.5 0.5 U = 0.6X + 0.4Y .  •…

A: Disclaimer: “Since you have posted a question with multiple sub-parts, we will solve the first three…

Q: By considering the utility equation = x/y/2 and the constraint MPX+PY. Prove that the Total effect…

A:

Q: An individual has an income of 240 and finds his satisfaction by consuming goods x1 for 2$ and x2…

A: Utility refers to the satisfaction. The aim of consumer is to maximize the utility. Given the…

Q: Suppose that the following utility function is given U(X,Y) = x2+Y Which of the following is…

A: A utility function is said to be convex utility preference if its quasi concave which implies the…

Q: Timothy has a utility function that depends on the number of musicals and the number of operas seen…

A: Introduction- Utility is determined by a consumer, on the basis of happiness or satisfaction that he…

Q: Question 8 An optimizing consumer will select the consumption bundle in which the marginal rate of…

A: Marginal Rate of substitution is the volume of good that a consumer is willing to consume in…

Q: Calculate the marginal rate of substitution (MRS12) for the following utility function: U(q1, 42) =…

A: Here, utility function is given as: U(q1, q2)=4q1+√q2 To find: MRS(1,2) at the bundle (13, 2)

Q: Suppose a consumer consumes two goods, X and Y. The slope of the budget constraint equals the a.…

A: A budget constraint illustrates the various combinations of two goods that a consumer can purchase…

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

A:

Q: Q.7 A consumer's utility function is given by the expression: i = (0.6À"s + 0.4y"s). • Determine the…

A: Note- Since, you've asked question with multiple subparts, we'll only solve the first three subpart…

Q: Suppose an individual had a utility function given by: U = X0.6 y 0.8. Calculate this individual's…

A: utility function is an important concept that measures preferences over a set of goods and services.…

Q: A KU student maximizes his sporting utility by playing Golf (G) and Tennis (T). His function is…

A: The maximum utility that a person can possibly experience given a certain price, quantity, and…

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: For the consumer whose choices are shown in the diagram, the substitution effect of the price change…

A: Substitution effect is change in demand or consumption of  a commodity or a service due to a change…

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: Gabby has the utility function U(X,Y) = X0.y0.26 When Gabby consumes X= 5 and Y=8 she has a marginal…

A: MRS = (MUx)/(MUy) MUx = dU/dx = Y0.25.0.5X(0.5-1) = 0.5Y0.25X(-0.5) MUy = dU/dy =…

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

A: Marginal utility is the additional utility gained from consuming an additional unit of the good.

Q: The shape of a person's indifference curves between two goods depends on A) the marginal rate of…

A: Government has certain tax revenue with them through which they have to carry expenditure on…

Q: Consider the following utility function: U= 100x0.50y0.50 A consumer faces prices of P, = $2 and P,…

A: The provided utility function is: U=100X0.50Y0.50

Q: John has a utility function for chocolates (x) and candy (y) which is represented by u(x,y)=xy.…

A: The substitution effect occurs when consumers replace cheaper goods with more expensive ones as a…

Q: marginal rate of substitution (MRS) can be defined as: Select one or more: a. The amount of one…

A: Marginal rate of substitution depicts the relative price of two goods.

Q: Given the following Cobb Douglas Utility function u(x1, x2) = x1cx2d.What is Marginal Rate of…

A: Answer- Need to find- Marginal Rate of Substitution MRS x1, x2  Given in the question- u(x1, x2) =…

Q: Consider the following utility function: U= 100x 50,0.50 %3D A consumer faces prices of P, = $2 and…

A: U=100X^0.5Y^0.5 Px=$2 Py=$1 MRS=1.83 MRS is the ratio of marginal utilities of the two goods In a…

Q: For the utility function,  U = 2x1/2 + y  What are the income and substitution effect of price…

A: We are going to use Slutsky equation to identify and calculate income effect and substitution effect…

Form Utility

The term utility in general refers to the satisfaction earned from usage of a particular product or service. Utility always plays an important role because it influences various important elements like demand & thereby the price of the good or service as well. Though utility is not easy to measure, various types of economic models can be used indirectly. There can be various types of utilities like economic utility, marginal utility, cardinal utility, form utility.