Question: please help me in this question A consumer has a utilityfunction given by u 2 111(3) l y. The perunit prices for goods :2: and

please help me in this question

 please help me in this question A consumer has a utilityfunction

A consumer has a utilityfunction given by u 2 111(3) l y. The perunit prices for goods :2: and y are $4.00 and $16.00, respectively. What is the optimal consumption ofeach good if income = $250.00? Good as: I . [Round to the nearest two decimals if necessary.) Good y: .. I (Round to the nearest two decimals if necessary.) Part 2 (2 points) From the previous part, assume everything remains constant except the perunit prices have now changed to par: $5.00 and pg. = $18.00. What is the optimal consumption of a: and 3; now? Good as: {Round to the nearest two decimals if necessary.) Good y: (Round to the nearest two decimals if necessary.) Part 3 (1 point) For the above utility function, prices, and income, what is the equivalent variation? {Round to the nearest two decimals if necessary.)

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!