Question: A consumer currently spends a given budget on two goods, X and Y , in such quantities that the marginal utility of X is 1

A consumer currently spends a given budget on two goods, X and Y, in such quantities that the marginal utility of X is 12 and the marginal utility of Y is 8. The unit price of X is $3 and the unit price of Y is $4. The utility-maximizing rule suggests that this consumer should

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 Economics Questions!

Q:

Mrs. Arnold is spending all her money income by buying bottles of soda and bags of pretzels in such amounts that the marginal utility of the last bottle is 40 utils and the marginal utility of the...

Q:

A consumer currently spends a given budget on two goods, X and Y, in such quantities that the marginal utility of X is 10 and the marginal utility of Y is 21. The unit price of X is $2 and the unit...

Q:

A consumer currently spends a given budget on two goods, X and Y, in such quantities that the marginal utility of X is 6 and the marginal utility of Y is 12. The unit price of X is $2 and the unit...

Q:

Ahmad choosing between two goods, X and Y, and your marginal utility from each is as shown in the table below. If your income is $12and the prices of X= $2 and price of Y is $2. Unit of product Good...

Q:

1. Deb spends all his income, M, on two goods, x and y. Suppose his marginal rate of substitution between x and y (MRSx,y) is 3 when he has more y than x (that is, y > x), and his marginal rate of...

Q:

Assume that an individual consumes three goods, X, Y, and Z. The marginal utility (assumed measurable) of each good is independent of the rate of consumption of other goods. The prices of X, Y, and Z...

Q:

Ahmad choosing between two pods, X and Y, and your marginal utility from each is as shown in the table below. If your income is S12and the prices of X = $2 and price of Y is $2. Marginal utility per...

Q:

Jane consumes two goods, X and Y. Jane have a utility function given by the expression: U = 12XY. This implies that MUx = 12Y and MUy = 12X. The current prices of X and Y are $8 and $2 respectively,...

Q:

Question 1 [30 marks] Consider a consumer who has preferences over two goods, x and y, represented by the utility function u(x, y) = x 3/5 y 2/5 . a) [5 marks] Find equations for this consumers...

Q:

Assume that an individual consumes three goods, X, Y, and Z. The marginal utility (assumed measurable) of each good is independent of the rate of consumption of other goods. The prices of X, Y, and Z...

Q:

Koa's Fluffy Boas makes a product that passes through two departments. Data for the first department is as follows: WIP-Opening Units Started Units Transferred Costs added Units 40,000 200,000...

Q:

The following transactions occurred for Ward Technology Solutions: May 1 The business received cash of $ 75,000 and issued common stock to Zoe Ward. 2 Purchased office supplies on account, $ 500. 4...

Q:

What is the auditors' responsibility for reporting on other information accompanying financial statements?

Q:

important pieces of the U.S. administrative law. C. Also, include at least two examples of when administrative law as opposed to law created by a legislature or legal rulings created by courts would...