1. For each of following utility functions graph the indifference curves through the bundles (2,3) and...

 

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1. For each of following utility functions graph the indifference curves through the bundles (2,3) and (4,2). Find one other bundle on each indifference curve. For each of them find the formula for the marginal rate of substitution (if possible) and find the value of the MRS at (2,3.) and at (4,2). Which ones have strictly decreasing marginal rates of substitution? a) U(x.y) = xy b) U(x.y)-x+ 2y c) U(x.y)-min[x.3y] d) U(x.y) = xy + 10 e) U(x.y) - ln(x) + la(y) f) U(x.y) = x+ln y 1. For each of following utility functions graph the indifference curves through the bundles (2,3) and (4,2). Find one other bundle on each indifference curve. For each of them find the formula for the marginal rate of substitution (if possible) and find the value of the MRS at (2,3.) and at (4,2). Which ones have strictly decreasing marginal rates of substitution? a) U(x.y) = xy b) U(x.y)-x+ 2y c) U(x.y)-min[x.3y] d) U(x.y) = xy + 10 e) U(x.y) - ln(x) + la(y) f) U(x.y) = x+ln y

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Solution a Ux y xy 3D U23 2 3 6 U42 4 2 8 ... View the full answer