Question: Clarissa's has a Cobb-Douglas utility function U(x,y) = x 0.2 y 0.8 .Her income is $100, the price of x is $2 and the price

Clarissa's has a Cobb-Douglas utility function U(x,y) = x^0.2y^0.8.Her income is $100, the price of x is $2 and the price of y is $4. How many units of good x will she consume?

For every set of indifference curves there exists a unique utility function that describes these preferences.

True

False

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!

tutors all questions are attached below 1. Imagine an individual who has the following Cobb-Douglas Utility function: U = $1 0.25 0.75 This person has an income of $70,000. Suppose the price of Good...

Your client, InsureCorp, is an insurance company considering launching an income insur- ance product in the island nation of Autarka. Income insurance is a product that fully insures a household...

Suppose there exists a consumer with a Cobb-Douglas utility function. U = x a 1x (1a) 2 Recall that in this case, the demand equations are given by the following: x1 = a m p1 x2 = (1 a) m p2 Suppose...

A consumer has a Cobb-Douglas Utility Function: U = x 0.5 y 0.5 . The price of good x is $2, the price of good y is $4, while the person has an income of $40. Find the solution to the consumer's...

1. Consider a utility function U (X A, X B) = XA X3. Let PA = $3 and PB = $2, and income is set at m = $40. Suppose PB falls to P3' =1. (30 pts.) a. Before the price change, what was X *A and X *3,...

4. Janet has preferences represented by a utility function u = X 2 + y 2 . Her income is $100 and the price of each good is $1. (a) Acting as a mechanical nincompoop, compute the point on the budget...

Paula's preferences for goods x and y are given by the utility function, U = x 1/2 y 1/2 . Her income is $160, and the price of good y is always $20. Suppose the price of x starts at $20 and then...

6. (15 points) Chloe consumes only books (x) and video games (y). Her preferences can be represented by the following utility function: U (x, y) = xyz. The price of books is 2, the price of video...

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...

You are planning to open an ice cream parlor. You want to have a wide variety of flavors for your patrons to select from, so you are going to ask potential customers to identify their favorite...

Find the elementary matrix E such that EC = A where 4 3 0 A = 2 8 E = -8 1 -1 and C = 2 3 4 ? ? ? ? ? ? ? ? ? 4 3 1 0 -1 -11 2

4.5 Magellanic penguins. Example 3.6 (page 73) described a study of Magellanic penguins breeding. Figure 3.3 (page 73) shows the relationship between starvation and fledging in the Punta Tombo colony...

Product element of the destination marketing mix for Orlando includes which of the following? A . Roads B . Parks C . Online package deals All of the above A and B only

Describe the collective bargaining process and explain collective bargaining issues.

Explain why employees join unions.

Discuss breakdowns in the negotiations process.