Question: Suppose that the utility function for two products is given by U=x2y, and the budget constraint is 2x+3y=120. Find the values of x and y

Suppose that the utility function for two products is given by U=x2y, and the budget constraint is 2x+3y=120. Find the values of x and y that maximize utility. Check by graphing the budget constraint with the indifference curve for maximum utility and with two other indifference curves.

Step by Step Solution

★★★★★

3.55 Rating (162 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

The objective function is 1 Fx y x 2 y 2x 3y 120 F x 2xy 2 F y x 2 3 ... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Document Format (1 attachment)

1386-M-C-L-A-D(4796).docx

120 KBs Word File

Students Have Also Explored These Related Calculus Questions!

Suppose that the utility function for two goods X and Y is given by U = xy2, and a consumer purchases 9 units of X and 6 units of Y. (a) If the consumer purchases 9 units of Y, how many units of X...

Suppose that the utility function for two commodities is given by U=xy2 and that the budget constraint is 3x+6y=18. What values of x and y will maximize utility?

Suppose that the utility function for two commodities is given by U=x2y3, and the budget constraint is 10x+15y=250. Find the values of x and y that maximize utility. Check by graphing the budget...

GO THROUGH THESE AND HELP ME SOLVE.... MICRO ECONOMICS WORKS 1. Question 5 (Choice) Mrs. Gordon has 3 sons. She spends $1013 on each boy during the holiday season to buy them chocolate and gummy...

If the utility function for two commodities is U=x2y, and the budget constraint is 4x+5y=60, find the values of x and y that maximize utility.

Question 1 (Consumer optimization problem in a two period model with investment) Suppose the utility function is given as: U = Cl + c'l' and the lifetime budget constraint is given as: I r _ r: (1...

Please Answer all parts of the question on paper and please show all work. Question 1 (Consumer optimization problem in a two period model with investment) Suppose the utility function is given as: U...

Question 2 (26 points): Suppose an individual's utility function for two goods X and Y is given by U(X,Y) =X(1/2)Y(1/2). Denote the price of good X by Px, price of good Y by Py, and the income of the...

Question 2 (26 points): Suppose an individual's utility function for two goods X and Y is given by U(X,Y) = X(1/2)y(1/2). Denote the price of good X by P., price of good Y by Py, and the income of...

solve the following c Consider a simple utility function for two goods, x1 and x2: u = (x1 1) 1 (x2 2) 2 , with 1 > 0, 2 > 0. The parameters 1 and 2 are constants, but they could be positive or...

With reference to the Marcom Insight segment that opened the chapter and in view of the detailed section on brand equity later in the chapter, explain why brand awareness is a necessary but...

If employees are properly selected there should be no need for training? Do you agree or disagree? Why?

Write a short note on the techniques of forecasting.

4. In an unfettered market, certain goods and services that people want will not be produced in adequate amounts. These public goods have characteristics that make it difficult or impossible for the...

Show that in Example 1 the absolute value of the error of x2 = 2.000/39.95 = 0.05006 is less than 0.00001.

Nested form evaluate f(x) = x3 7.5x2 +11.2x + 2.8 = ((x 7.5)x + 11.2)x + 2.8 at x = 3.94 using 3S arithmetic and rounding, in both of the given forms. The latter, called the nested form, is usually...

Estimate the error in Prob. 1 by (5)

Cyber Security and Crime option One: In this web research project, identify at least four types of cybercrimes. Using at least two sources on the Internet, briefly research cybercrimes, and write a...

The table below shows market prices for four zero coupon bonds with four different terms: one, two three and four years. The bonds all have a face value of $1,000. Calculate the yields on the zero...

1. Read through the article, Interaction of Oxytocin Leven and Past Depression May Predict Postpartum Depressive Synnitoni Severity (Massey et a1, 2016), and answer the following questions. a. Name...