Devon's utility function can be written as ?1^0.50?2^0.50, where ?1 is the quantity of hamburgers consumed and x2 is the quantity of milk shakes. His income is $2,400.00. 1) Hamburgers cost $8.00 each and the price of one milk shake is $4.00. If he is maximizing his utility, how much will Devon spend on hamburgers? $ 2)The price of hamburgers decreases to $7.37 each. Now, how much will Devon spend on hamburgers if he is maximizing his utility? $

Devon's utility function can be written as ?1^0.50?2^0.50, where ?1 is the quantity of hamburgers consumed and x2 is the quantity of milk shakes. His income is $2,400.00. 1) Hamburgers cost $8.00 each and the price of one milk shake is $4.00. If he is maximizing his utility, how much will Devon spend on hamburgers? $ 2)The price of hamburgers decreases to $7.37 each. Now, how much will Devon spend on hamburgers if he is maximizing his utility? $

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter6: Consumer Choice And Demand

Section: Chapter Questions

Problem 13PAE

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Question

Devon's utility function can be written as ?1^0.50?2^0.50, where ?1 is the quantity of hamburgers consumed and x2 is the quantity of milk shakes. His income is $2,400.00.

1) Hamburgers cost $8.00 each and the price of one milk shake is $4.00. If he is maximizing his utility, how much will Devon spend on hamburgers? $

2)The price of hamburgers decreases to $7.37 each. Now, how much will Devon spend on hamburgers if he is maximizing his utility? $

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