Question: If a consumer has a utility function u(x1, x2) = x1x4 2, what fraction of her income will she spend on good 2?

If a consumer has a utility function u(x1, x2) = x1x4 2, what fraction of her income will she spend on good 2?

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Introduction To Microeconomics Questions!

Q:

1. A consumer has the utility function U (x 1 , x 2 ) = min (2x 1 , x 2 ) and an income of $200. Initially, the price of good 1 is $6 and the price of good 2 is $2. a) Find consumer's demand function...

Q:

man2 Exercise #1. Annas preferences over consumption bundles (x1,x2) are summarized by the utility function U (x1,x2) = x1 (x2 + 1)2. (a) Derive an algebraic expression for the marginal utility MU1...

Q:

1. A consumer has the utility function U ( x 1 , x 2 )= min {2x 1 ,x 2 } and an income of $200. Initially, the price of good 1 is $6 and the price of good 2 is $2. a) Find consumer's demand function...

Q:

Assume a consumer has the utility function U (x1 , x2 ) = ln x1 + ln x2 and faces prices p1 = 1 and p2 = 3 . [He,She] has income m = 200 and [his,her] spending on the two goods cannot exceed her...

Q:

Imagine a consumer with a utility function: U (X1, X2) = X1 + ln X2. If the consumer has a wage M and the prices of the goods are p1, p2, what is the price elasticity of demand for good X1?

Q:

Consider a consumer with a utility function u (x1, x2) = Vx + x2 .lf the prices for goods 1 and 2 are 2 and 1 respectively, and income is 20, what is the consumer's optimal consumption of good 1?

Q:

We consider a utility-maximizing consumer with the utility function: U (x1, x2) = 4 (x1 + 2) x2 We assume that the consumer has a given budget of NOK 10. The price of x1 is one NOK and the price of...

Q:

Hi, please provide full answer - for assignment very desperate. Is the following claim true, false, or ambiguous? Justify your answer. "A consumer has the utility function U (x1, x2) = x1 + 2 x2 ....

Q:

We consider a utility-maximizing consumer with the utility function U (X1, X2 = 4 (X1 + 2) X2 WE ASSUME THAT THE CONSUMER HAS A GIVEN BUDGET OF 10 NOK. THE PRICE OF X1 IS ONE KRONE AND THE PRICE OF...

Q:

2 a) Given utility function U (C; R) = min (C; 2R); daily endowment of time 24h, price and wage pc= w = 1; nd optimal choice of C; relaxation time R and labor supply L. (three numbers, use secrets of...

Q:

Gibson Assembly Several enzymes are present in the Gibsonassembly reaction. For each of the following enzymes, define therole of the enzyme at room temperature (when the reaction is setup) and at 50...

Q:

For each situation listed, indicate by letter the appropriate qualitative characteristic(s) or accounting concept(s) applied. A letter may be used more than once, and more than one characteristic or...

Q:

Which of the following might cause the board of directors of an MNC to not be effective at governance? The firm's CEO serves as chair of the board. The board consists mainly of outside members who...

Q:

Fiscal policymakers in a large open economy are reluctant to cut taxes or raise spending. If real GDP is less than natural real GDP, will the central bank be able to reduce unemployment? Under what...