5. Natasha enjoys Flying (F) and taking Judo (J). For every flight she buys, she gets three times as much enjoyment as a Judo class. (15 points)

(a) Write down a utility function that represents Natasha's preferences, U(F, J) =

(b) Given that pF = 90, pJ = 20 and Natasha has an income of $900, solve for Natasha's utility maximizing bundle.

F = J =

(c) Suppose there is now a $5 per unit tax imposed Judo classes. Find the Natasha's new optimal bundle and the tax revenue.

F = J = T R =

Answer rating: 100% (QA)

a To represent Natashas preferences we can use the following utility function UF J F 3J Here F repre... View the full answer