Elmer's utility function is u(x, y) = min{x, y). a. If Elmer consumes 4 units of...

 

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Elmer's utility function is u(x, y) = min{x, y). a. If Elmer consumes 4 units of x and 3 units of y, his utility is 4. b. If Elmer consumes 4 units of x and 2 units of y, his utility is 4. c. If Elmer consumes 5 units of x and 2 units of y, his utility is 4. d. On the graph below, use blue points (circle symbol) to plot the indifference curve for Elmer that contains the bundles that he likes exactly as well as the bundle (4, 2). Line segments will automatically connect the points. e. On the same graph, use orange points (square symbol) to plot the indifference curve for Elmer that contains bundles that he likes exactly as well as the bundle (1, 1) and green points (triangle symbol) to plot the indifference curve that passes through the point (16, 5). Again, line segments will automatically connect the points. f. Starting at the origin on the graph, use purple points (diamond symbol) to plot the locus of points at which Elmer's indifference curves have kinks. What is the equation for this curve? x = y? g. On the same graph, use a red line (cross symbol) to show Elmer's budget line when the price of x is 1, the price of y is 2, and his income is 8. What bundle does Elmer choose in this situation? (4,2) y 20 18 16 14 12 10 8 6 2 4 8. 10 12 14 16 18 20 Help Clear All h. Suppose that the price of x is 10 and the price of y is 15 and Elmer buys 100 units of x. What is Elmer's income? 1,150.00 (Hint: At first you might think there is too little information to answer this question. But think about how much y he must be demanding if he chooses 100 units of x.) Graphs Tool 1.55 2002-2013 Cengage Learning. All rights reserved. 2. Elmer's utility function is u(x, y) = min{x, y). a. If Elmer consumes 4 units of x and 3 units of y, his utility is 4. b. If Elmer consumes 4 units of x and 2 units of y, his utility is 4. c. If Elmer consumes 5 units of x and 2 units of y, his utility is 4. d. On the graph below, use blue points (circle symbol) to plot the indifference curve for Elmer that contains the bundles that he likes exactly as well as the bundle (4, 2). Line segments will automatically connect the points. e. On the same graph, use orange points (square symbol) to plot the indifference curve for Elmer that contains bundles that he likes exactly as well as the bundle (1, 1) and green points (triangle symbol) to plot the indifference curve that passes through the point (16, 5). Again, line segments will automatically connect the points. f. Starting at the origin on the graph, use purple points (diamond symbol) to plot the locus of points at which Elmer's indifference curves have kinks. What is the equation for this curve? x = y? g. On the same graph, use a red line (cross symbol) to show Elmer's budget line when the price of x is 1, the price of y is 2, and his income is 8. What bundle does Elmer choose in this situation? (4,2) y 20 18 16 14 12 10 8 6 2 4 8. 10 12 14 16 18 20 Help Clear All h. Suppose that the price of x is 10 and the price of y is 15 and Elmer buys 100 units of x. What is Elmer's income? 1,150.00 (Hint: At first you might think there is too little information to answer this question. But think about how much y he must be demanding if he chooses 100 units of x.) Graphs Tool 1.55 2002-2013 Cengage Learning. All rights reserved. 2.

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Elmer indifference curve is when utility function parameters are equal to each other ie X... View the full answer