Suppose that a consumer with the utility function U = X^.75 Y^.25 choses a bundle where X=10 and Y=5. If the prices of the two goods are PX = $3, and PY = $1, calculate marginal utility obtained per dollar spent on each good and show whether this consumer can increase utility without increasing expenditure?
Suppose that a consumer with the utility function U = X^.75 Y^.25 choses a bundle where X=10 and Y=5. If the prices of the two goods are PX = $3, and PY = $1, calculate marginal utility obtained per dollar spent on each good and show whether this consumer can increase utility without increasing expenditure?
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter6: Consumer Choice Theory
Section: Chapter Questions
Problem 11SQ
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Suppose that a consumer with the utility function U = X^.75 Y^.25 choses a bundle where X=10 and Y=5. If the prices of the two goods are PX = $3, and PY = $1, calculate
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