The utility function for an individual is given as u (x; y)= xy. Suppose that his income is S 100 and the price of Good Y is S 10 per unit. However, Good X is priced somewhat different. It is priced as follows: The first 6 units cost S 10 per unit and any additional units cost S 5 per unit. a) Draw this individual's budget constraint. b) What consumption bundle will this individual choose?
The utility function for an individual is given as u (x; y)= xy. Suppose that his income is S 100 and the price of Good Y is S 10 per unit. However, Good X is priced somewhat different. It is priced as follows: The first 6 units cost S 10 per unit and any additional units cost S 5 per unit. a) Draw this individual's budget constraint. b) What consumption bundle will this individual choose?
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter6: Consumer Choice Theory
Section: Chapter Questions
Problem 25SQ
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