Derives enjoyment according to the utility function

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Reference no: EM13917196

Joan, a sports buff, enjoys playing golf and tennis each week and derives enjoyment according to the utility function

U (G, T) = 1/2G2T

Where G = rounds of golf and T = games of tennis. She has $24.00 per week to spend on these two activities and the price of a round of golf and a game of tennis are both $2.00.

1a) graphically show how the “optimal” consumption bundles are found. Sketch and label the graph.

1b) mathematically solve for G and T of the “optimal” bundle using the Tangency Method.

Reference no: EM13917196

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