Suppose that Jana cares only about apples and lettuce. Her utility function is U = A0.5L0.5, where
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Suppose that Jana cares only about apples and lettuce. Her utility function is U = A0.5L0.5, where A is the number of apples and L is the number of heads of lettuce that she consumes. The price of apples is $1, and the price of lettuce is $4. Suppose that Jana must have 100 units of utility and wants to achieve this level of utility with the lowest possible expenditure. How much does this optimal solution cost?
Related Book For
Microeconomics
ISBN: 9781464146978
1st Edition
Authors: Austan Goolsbee, Steven Levitt, Chad Syverson
Posted Date: