Question: Assume a consumer's level of satisfaction ( U ) when consuming units of two products, X and Y , is U = 2 x 0
Assume a consumer's level of satisfaction U when consuming units of two products, X and Y is
Uxy where X and Y are the quantities of goods X and Y Assume furthermore that the prices
of X and Y are $ and $ respectively.
a Find the quantities of X and Y by making use of Lagrange if the consumer plans to consume
the products in such a way as to receive a total satisfaction of points
b Calculate the budget that must be spent to acquire the combinations found in part a
points
a What would be the quantities of X and Y that this consumer should purchase if he spends a
budget of points
b What would be the consumer's satisfaction from the combination found in b
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