MICROECONOMICS 21E W/CNCT
21st Edition
ISBN: 9781307005851
Author: McConnell
Publisher: MCG/CREATE
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Question
Chapter 7.1, Problem 3QQ
To determine
Marginal utility .
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8) When Marginal Utility = 0, Total Utility is
A) Maximum
B) Constant
C) Minimum
D) None of the above
19) when total utility, U(X) is maximized, marginal utility, MUx is
a)constant
b)rising
c)maximized
d)zero
In ordinal Utility approach, let a consumer's utility function is given by TU X³Y.
If price of X is 2 birr and price of Y is 3 birr and if budget of the consumer is 100 birr for consumption of X and Y. then what are the utility maximization X and Y?
Chapter 7 Solutions
MICROECONOMICS 21E W/CNCT
Ch. 7.1 - Prob. 1QQCh. 7.1 - Prob. 2QQCh. 7.1 - Prob. 3QQCh. 7.1 - Prob. 4QQCh. 7.A - Prob. 1ADQCh. 7.A - Prob. 2ADQCh. 7.A - Prob. 3ADQCh. 7.A - Prob. 1ARQCh. 7.A - Prob. 2ARQCh. 7.A - Prob. 1AP
Ch. 7.A - Prob. 2APCh. 7.A - Prob. 3APCh. 7 - Prob. 1DQCh. 7 - Prob. 2DQCh. 7 - Prob. 3DQCh. 7 - Prob. 4DQCh. 7 - Prob. 5DQCh. 7 - Prob. 6DQCh. 7 - Prob. 7DQCh. 7 - Prob. 8DQCh. 7 - Prob. 9DQCh. 7 - Prob. 10DQCh. 7 - Prob. 1RQCh. 7 - Prob. 2RQCh. 7 - Prob. 3RQCh. 7 - Prob. 4RQCh. 7 - Prob. 5RQCh. 7 - Prob. 1PCh. 7 - Prob. 2PCh. 7 - Prob. 3PCh. 7 - Prob. 4PCh. 7 - Prob. 5PCh. 7 - Prob. 6PCh. 7 - Prob. 7P
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- What is the definition of marginal utility? A. The average utility from consuming a good or service multiplied by the number of units of that good or service consumed. B. Utility measured in utils. C. The utility from consuming a good or service divided by the number of units of that good or service consumed. D. The change in utility from consuming an additional unit of a good or service. E. The enjoyment or satisfaction people receive from consuming goods and services.arrow_forwardExplain the law of Equi marginal utility with the help of schedule. (arrow_forwardIt is known that the indifference curve is convex. What does this tell you about the relationship between the goods? 2. Using examples, does an increase in income affect a consumer’s budget line? Does it impact their total utility. 3.You are interested in starting a coffee shop at the University of the West Indies. Provide examples with explanations of explicit costs, implicit cost and sunk costs related to this business.arrow_forward
- What happens to the original budget line if the price of good ? falls to 4$? (i.e., Will there be a change in the slope and/or intercepts of the original budget line? If yes, what are those changes?). Interpret economically how the change in the price of good ? affects the consumption decision of the consumer.arrow_forwardPsy QUESTION: Use the sheet 1( picture below) utility function and parameter values to find the optimal solution via analytical methods (calculus/lagrangean/algebra). Show your work. Note that x1<a/b, so we will use the first utility function given in the yellow box in the sheet.arrow_forwardA consumer’s budget set for two goods (X and Y) is 500 ≥ 4X + 5Y.a. The budget set is illustrated below. What are the values of A and B? The horizontal axis is labeled Good X. The vertical axis is labeled Good Y. A line begins at a point on the vertical axis goes down to the right and ends at a point on the horizontal axis. A = B = b. Does the budget set change if the prices of both goods double and the consumer’s income also doubles? multiple choice Yes, it rotates clockwise Yes, it shifts out from the origin Yes, it shifts in toward the origin No, it does not change c. Given the equation for the budget set, what are the prices of the two goods?Good X: $ Good Y: $ What is the consumer’s income? $arrow_forward
- Scruffie the cat has $15 to spend each month on cat toys, which cost $3 each, and cat treats, which cost $1.50 each. Draw a budget line to show the combinations of each good that Scruffie can afford if she spends her entire budget. Now suppose that cat treats go on sale for $1 each. How does this change in price affect the budget line (describe and show on a graph)?arrow_forwardPractice Question 3: Joe's income is $1000, the price of pizza (P) is $10 per unit, and the price of burger (B) is $8. Which of the following represents his budget constraint? Group of answer choices 1 500+4B=5P 2 5P+4B=500 3 100=P+1.2B 4 1000=8P+10Barrow_forwardLaw of equi marginal utility is an important law of cardinal utility analysis. Explain this law with the help of its assumptions. Furthermore, there is a relationship between total and marginal utilities where they both pass through different stages when the consumer continues his or her consumption regularly. Elaborate.arrow_forward
- PROBLEM 2.25% PARTIAL DIFFERENTIAL LAGRANGE OPTIMIZATION In the era of the Covid 19 pandemic, we are required to consume lots of fresh fruits. The satisfaction of a consumer in consuming two kinds of fruit, namely Apples (X) and Oranges (Y) is: U = X3 Y2 income or budget to buy the two fruits is Rp. 250,000, the price of apples IDR 75,000/fruit and the price of oranges is IDR 25,000/fruit. a. How many apples and oranges must be obtained in order to achieve optimum satisfactionb. Calculate the optimum satisfaction value that can be achievedarrow_forwardSOLVE ONLY B 1. Suppose that you have an income of $10 to spend on sticky hands and gumballs. Both cost $1.00. a.) Solve for the budget constraint, using gumballs as your x variable. Graph the budget constraint. Draw an indifference curve such that the optimal consumption bundle is 5 gumballs and 5 sticky hands. b.) Suppose that the price of gumballs falls to 25 cents. Draw the new budget constraint, original budget constraint from a.) and original indifference curve from a.) in a new graph. Draw a new optimal in indifference curve such that gumballs and sticky hands are substitutes and sticky hands are a normal good.arrow_forwardWhich utility function represents quasi-linear utility function in y. A. U = x^2+y B.U=X+Y C.U=min (x, y) D.U=x^2+xy. Please answer correct calculation asap plz Don't answer by pen paper plzarrow_forward
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