Cero has utility U = -{(x -50)^2+ (y -40)^2}, Px = Py = 1 and M = 100.
a.If he receives an additional 10 income how does he spend it? Just on x, just on y or some on x and some on y or on neither? Ted has utility U = 5x^2+ 8y^3 Px = 1 Py = 2 a.At what income is Ted indifferent between buying only x or only y?
b.If income were above the level found in part a, which good would he buy exclusively?
c.If income were below the level found in part a, which good would he buy exclusively?
d.Would the same answers for parts a, b, c hold true if utility were U = 10x^2+ 16y^3and why or why not?
Josh has utility U= -min{4x, 5y} Px=7 Py=10 M=140
a.What is the highest utility he can get?
b.What is his optimal point?
Cero has utility U = -{(x -50)^2+ (y -40)^2}, Px = Py = 1 and M = 100.
a.If he receives an additional 10 income how does he spend it? Just on x, just on y or some on x and some on y or on neither? Ted has utility U = 5x^2+ 8y^3 Px = 1 Py = 2 a.At what income is Ted indifferent between buying only x or only y?
b.If income were above the level found in part a, which good would he buy exclusively?
c.If income were below the level found in part a, which good would he buy exclusively?
d.Would the same answers for parts a, b, c hold true if utility were U = 10x^2+ 16y^3and why or why not?
Josh has utility U= -min{4x, 5y} Px=7 Py=10 M=140
a.What is the highest utility he can get?
b.What is his optimal point?
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