Assume that a person's vitility function is given TU = 2x¹¹2²¹/2 Assume by the following function. also that the price of x is 22 and the price of. is 26 and that the budget is 2240. of y what is the optimal amount of goodly x and that should be purchased with this budget? у

Assume that a person's vitility function is given TU = 2x¹¹2²¹/2 Assume by the following function. also that the price of x is 22 and the price of. is 26 and that the budget is 2240. of y what is the optimal amount of goodly x and that should be purchased with this budget? у

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter6: Consumer Choices

Section: Chapter Questions

Problem 2SCQ: Take Jeremys total utility information in Exercise 6.1, and use the marginal utility approach to...

See similar textbooks

Related questions

Q: The Calculus of Equilibrium and Elasticities Suppose that the quantity supplied of TV stands is…

A: the elasticity of demand measures the quantitative relationship between the price and quantity…

Q: QUESTION 7 The output gap is increasing over time because actual GDP is greater than potential GDP…

A: The output gap is an economic proportion of the distinction between the actual result of an economy…

Q: PRICE O C P₁ Od 0," P₂ P₁ Ob P3. P2. A P4 B D F LL G d Refer to Figure 7-9. The equilibrium price is…

A: In a market, when talking about the equilibrium condition, it can be said that it is the situation…

Q: Long-run average cost (AC) of operation may decrease for three reasons. a. List and explain the…

A: DISCLAIMER “Since you have asked multiple question, we will solve the first 3 subparts for you. If…

Q: Problem 2: You were entitled to receive $5,000 at the end of six months for the rest of your life.…

A: Amount received = 5000 r = 10%

Q: Q4 Michael spends all of his money on yams and pudding. His utility function is y-5 2p-5, MU, Op O…

A: Michael's utility function U=p0.5y0.5 Marginal utility of good pudding MUp=y0.52p0.5 Marginal…

Q: The demand and supply schedules in this table list the quantity supplied and quantity demanded of…

A: Demand refers to the quantity that a consumer wishes to buy at a given price in a given period of…

Q: Please use the answer choices below to answer the question, Thanks* The semiconductor chip shortage…

A: At Equilibrium Price, Quantity Demanded is equal to Quantity Supplied. As the demand increases, the…

Q: 1. Suppose a utility function is given by u(x₁, x2) = 2√√x₁ + 4x₂. (a) Specify the equation of the…

A: Utility function: u(x1,x2)=2x1+4x2 ...... (1) The optimal consumption bundle is (9,4) and…

Q: A small company heats its building and will spend $9,900 in year 1 on natural gas for this purpose.…

A: The answer is well explained below hope you will like it. Any doubt's feel free to ask in the…

Q: Which of the following is the proper formula for GDP once you adjust it so it explicitly shows the…

A: GDP The market value of all financial goods and services produced in a domestic territory over a…

Q: You deposited P200,000 at BPI with an interest rate of 4% compounded semi-annually. What is the…

A: P200,000 x (1+(4%/2))11 = P269,512.20 Your money will be worth P269,512.20 after 5 years and 6…

Q: 1. It is a social state where the seller and the buyer are both have freedom to sell and to buy…

A: "As these are two different questions answer is provided to the first question." 1) "In an economy,…

Q: Problem 3. (SW 7.10) Show that the two alternative formulas below for the homoscedasticity-only…

A: Homoscedasticity in regression refers to the constant variance of the error term. It is one of the…

Q: The local goverment unit is planning to construct a steel foot bridge in Davao City. The estimated…

A: Given Construction cost (initial cost at t=0) = P400M Annual maintenance cost of the bridge…

Q: produce a discussion paper for a group exercise with other candidates which analyses the…

A: The cultural and regulatory diversity of international markets can present both challenges and…

Q: Learnin The majority of fresh fruit consumed in the United States is now imported, much of it coming…

A: Given the world price line is at P=$4 The US imports fruits from Mexico, Chile, Guatemala, and…

Q: Use the blue points (circle symbol) to graph the demand for pizzas. Then use the orange points…

A: The equilibrium price between cost and equilibrium amount happens when the supply and demand cross.…

Q: Question Z Draw a production possibility frontier. The vertical axis shows the production of public…

Q: In year 1, the level of capital per worker is 16. In a table such as the following one: Year 1 2…

A: The Solow Growth Model demonstrates how long-term capital accumulation and production in an economy…

Q: Refer to the table below. Type of Production Production Alternatives A B C D E Automobiles 0 2 4…

A: Production possibility curve shows the combination of production of two different goods with the…

Q: F2

A: We know that Purchasing Power Parity is an economic concept that helps in comparing the currencies…

Q: Suppose you want to withdraw $30,000 at the end of year 3 and another $30,000 at the end of year 5.…

A: When money is put somewhere, interest is accrued. Principal value refers to the original deposit,…

Q: Acme Semiconductor is expanding its facility and needs to add equipment. There are three process…

A: Particular Tool A Tool B Tool C Investment Cost 55000000 45000000 80000000 Annual Expenses…

Q: Question 07 The figure below shows the supply and demand of two related markets: college degrees and…

A: Here, when analyzing given graphs, it can be said that the first graph indicates market for College…

Q: SECTION A: ANSWER ALL QUESTIONS 1. Financial intermediation is? A. Savers being matched with…

A: Since you have provided multiple questions, we will solve the first question for you. If you want…

Q: The university states that emergency medical technicians ne be at all games to tend to medical…

A: Introduction: The elasticity of demand depends on the availability of substitutes. For instance, if…

Q: Hey, I have a question on part D of question 5. I saw the answers that are available but the answer…

A: Elasticity of demand measures the percentage change in quantity demanded due to some percentage…

Q: Why aren't greater resources given to prudential regulation of the financial sector because it is…

A: It is difficult for regulators to effectively coordinate and collaborate with the financial…

Q: Use the table to answer the question. Number of Workers 10 O b O c d 20 30 Output (thousands) $0.43…

A: Number of workers Output Fixed Cost Variable cost 10 3 2000 100 20 5 2000 200 30 6 2000 300

Q: Question 11 Which of the following is NOT a property of indifference curves? A) Indifference Curves…

A: An indifference bend shows a mix of two goods in different quantities that gives equal satisfaction…

Q: Draw a production possibility frontier. The vertical axis shows the production of public sector…

A: Since you have posted multiple subparts, as per the guidelines we can solve only the first 3…

Q: 5. Uncle Ben plans to use his monthly retirement allowance and prepare the future of his 10-…

A: Uncle Ben should save $1,000 per month at 8% interest for 10 years to amount to $180,000 at the time…

Q: Are there any e-business applications that you would recommend to a small firm to help it survive…

A: There are a few e-business applications that can assist a small business survive and prosper in…

Q: If the Citrus Growers Association grows $1 million worth of oranges, sells $500,000 worth of…

A: 1) In the GDP computation all the final items and services produced within the boundary of country…

Q: A restaurant has a steady annual demand for 885 bottles of California wine. It costs $3 to store 1…

A: optimal order is an amount that is the cost-effective measure of stock that a business ought to have…

Q: Given the monthly payment as shown with interest as 1 % per month. Month 1 100 2 110…

A: From Payment for the months 2,3 it is clear that interest rate is 10% per month, not 1%(there might…

Q: For each of the following situations, i) Find the Marginal Rate of Substitution at the given bundle,…

A: As given the U(x, y) = 2X +3Y, Marginal rate of substitution is the slope of indifference curve also…

Q: 4) Suppose the supply curve for a product is given by Q³x = -300 + 4Px + 2Pz and Px = 30, P₂ = 40.…

A: Given Supply equation: Qsx=-300+4Px+2Pz ....... (1) Where Px =30 and Pz =40 The supply…

Q: Suppose that annual income from a rental property is expected to start at$1,100 per year and…

A: Given that; Annual income from the rental property is expected to start at $1,100 per year and…

Q: A consumer of two goods has indirect utility v(p, w) = P₁ √w + P₂ (a) Find the indirect money-metric…

A: In the study of economics, the term utility can be defined as the total satisfaction or benefit that…

Q: Why do presidents typically reappoint Chairs of the Federal Reserve Board even when they were…

A: The Central Bank of America, which is the main organisation in charge of overseeing the Federal…

Q: Consider the market for mobile applications, smartphones, and conventional phones. For each pair,…

A: When the two goods are complements, increase in price of one will decrease the demand for other…

Q: Erhan's opportunity cost of 1 bushel of corn is 3 bushels of wheat. Panikos' opportunity cost of 1…

A: According to comparative advantage theory, if a person has a lower opportunity cost in the…

Q: A consumer of two goods has indirect utility v(p, w) = 1/2 P₁ -1/2* + P₂ (a) Find the indirect…

A: In the study of economics, the term utility can be defined as the total satisfaction or benefit that…

Q: 53) Which of the following statements about the ripple effects of monetary policy is FALSE? Monetary…

A: Monetary policy is a bunch of activities to control a country's general cash supply and accomplish…

Q: 1. When one of the factors of production is fixed in quantity or is difficult to increase,…

A: 1) Law of diminishing return states that in a process of production wherein factors of production is…

Q: Home has 1,200 units of labor available. It can produce two goods, apples and bananas. The unit…

A: If relative prices were in equilibrium, the ratio would be 1.5, meaning that apples would cost 1.5…

Q: David works in a clothing factory. Currently, his firm pays him $40 per hour and he works 35 hours…

A: Given the following information: Firm pays wage = $40 per hourNumber of hours work = 35…

Concept explainers

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.

Question

100%

Assume that a person's vitility function is given
Assume
by the following function. TU = 2x¹¹2,¹/2
also that the price of x is 22 and the price of
is 26 and that the budget is 2240.
what is the optimal amount of goods x and
that should be purchused with this budget?
of y
у

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

1s it pessible fes matginal utility tolal to be negative and uwility to be possitive) why orwhy nah 8. no
ceriuppose that Isaiah has a weekly fixed budget and spends it all on haircuts and ice cream. At his current combination arof consumption, the marginal utility of the last dollar spent on haircuts is greater than the marginal utility of the last dollar spent on ice cream. Has Isaiah maximized his utility? A C E Yes, because changing his current consumption combination will reduce his total utility B No, because he can increase his total utility by purchasing more haircuts and D fewer ice creams Yes, because he has purchased 2 goods in proportion so that he can get- the maximum utility from each Yes, because he purchased the maximum possible with a limited budget No, because he can increase his total utility by purchasing fewer haircuts and more ice creams
Maya divides her income between coffee andcroissanls (both of which arc normal goods). An earlyfrost in Brazil causes a large increase in the price ofcoffee in the U nitcd Stites.a. Show the eflcct ol the frost on Maya's budgetconstraint.b. Shm" the effect ol the frost on Maya's optinu,loonsumption bwl<ile assunling that the substitutioneflcct outweiglls the income effect for croiss:mls.c. Show the eflcct of the frost on Maya's optimalconsumption bw,dle assuming that the incomeeffect outweighs the substitution effect forcroissants
What price ÅSsuming do you line and budget that understand by line? Consumer has income of $180, which monthly he Spends Good' X on two commodities and Grood Y. The price l07 Good $13 and price of the is $24. What would ' be Combinations of Crood X is Various Good Y this combinations line regard? and in and write draw various budget according ly?
goods, XandY per of good X is N$4 and the price of good Vis No10 Harrys unlity funchon is UCX,)==XY. Harry consumes 2 and he spend's Npbo month The price Find The values of gocal X and Y maximizes Harcys unly illustruate Hary's utlty maximizing.combinason clearly labelled on a graph. Suppose llustrate Harrys price & spod X increased to Ngb effects income and substitution ef the anel laballed graph.
Suppose an indinidual has the following utility finction Urey)-2+2" writh a strictly ineveaseng morrginal rate of substitntion. and income of 3 The price of y is $4 CPpi ) The intial price of x is $lcre=) and then increases to 3 px=3). Find the chonge in the quantidy consumed of X.IHow much of the chonge is the income effect? How much by the Substitution effect? Evplan in Econ terms erplainedl by
My Moodle My Favou tion 6 An individuals utility function is given by ret rered U = 340x1 + 960x2 + 2x1x2 – 2a- a/2, ed out of when the weekly amount of leisure is x1 132 and earned income is 12 = 760 answer the following: 1. The marginal utility of x1 is ag tion 2. The marginal utility of x2 is 3. Use the small increments formula to estimate the change in the utility when r1 decreases by 1 and x2 increases by 4. The change = 4. Does the law of diminishing marginal utility hold? 5. The MRCS at a given values is Enter non-integer numerical values as decimals to at least 3 decimal places. Note: you must use a. and not , for a decimal point. Next page revious page Mock paper ► - Working from video in SVG Jump to... format
a halving price of the prices of good A and Good B have the same effects on the budget line as doubling income. is this true or false and how woukld it look like using ana equation of a budget line
Pls help with thsi question I am stuck Given the image attatched: 1.Given the above Marginal Utilities and prices to form the optimality condition for utilitymaximization. According to this optimality condition, what must be the ratio of Films toBooks in an optimal consumption bundle? 2. Given your answer to Q9, what must be the household’s optimal consumption of F & Bgiven their income (m)? 3. Suppose that the price of Films changed from $2 to $4. What would need to happen tothe MRS according to the optimality condition in Q9 if the household wanted to keepmaximizing its utility?
Mylie’s total utility from singing the same song over andover is 50 utils after one repetition, 90 utils after tworepetitions, 70 utils after three repetitions, 20 utils afterfour repetitions, 250 utils after five repetitions, and 2200utils after six repetitions. Write down her marginal utilityfor each repetition. Once Mylie’s total utility beginsto decrease, does each additional singing of the songhurt more than the previous one or less than the previousone?
Adwoa purchases only pasta and salad with her income of ghc 160 a month. Assume the price of pasta is ghc 6 and the price of salad is ghc 5 each. Answer the following questions about Adwoa’s budget.i. Derive Adwoa’s budget equation and draw the line of this equationii. Using the budget line drawn in (i) show the effect of a 100 percent increase in the price pasta hold the price of salad and income constant.iii. Using the budget line drawn in (i) show the effect of a 100 percent increase in her income hold the price of pasta and salad constant.iv. What is the slope of Adwoa’s budget line? What does this mean to Adwoa?
39. The following chart shows thec total utility-that Ammar receives from çonşuming various amounts-of chocolate.candy bars each day: Number candy, bars consumed për đay Total'utility 1' 40- 2 70 90 100 4. 80 Which of the following statements about Ammar's marginal utility is correct? Hiş marginal utility from the first candy bar is greater-than his marginalutility from the second candy' bar