Yashvita likes playing badminton with her friends. Her utility function for playing badminton every week is given by U(t) = 11t - 2t^2 ( 2t raised to 2) where t is measured in hours. They play on a badminton court, which they can rent per hour. Suppose the current price to play on the badminton court is $2.50 per hour.
1.How many hours should Yashvita play if she wishes to maximise her utility?
2. Explain what we mean by the principle of diminishing marginal utility. Does the principle apply in Yashvita’s case? Explain why.
3. In a diagram with income in pound sterling on the horizontal axis and quantity on the vertical axis, show the relationship between Yashvita’s budget and the number of hours that would maximise her consumer surplus.
Yashvita likes playing badminton with her friends. Her utility function for playing badminton every week is given by U(t) = 11t - 2t^2 ( 2t raised to 2) where t is measured in hours. They play on a badminton court, which they can rent per hour. Suppose the current price to play on the badminton court is $2.50 per hour.
1.How many hours should Yashvita play if she wishes to maximise her utility?
2. Explain what we mean by the principle of diminishing marginal utility. Does the principle apply in Yashvita’s case? Explain why.
3. In a diagram with income in pound sterling on the horizontal axis and quantity on the vertical axis, show the relationship between Yashvita’s budget and the number of hours that would maximise her consumer surplus.
