Enjoys goods x and y according to the utility function

Reference no: EM13488694

Mr. J enjoys goods x and y according to the utility function
U(x,y)=3x2y
The price of good x is $4, the price of good y is $4, and he has $120 to spend.
(1) Write and draw Mr. J's budget line.
(2) Write the budget exhaustion condition of Mr. J's optimization problem.
(3) Write the rationality condition of Mr. J's optimization problem.
(4) Given the two conditions from (2) and (3), calculate the optimal bundle (x*, y*) that Mr. J will choose in order to maximize his utility.
(5) Qualitatively indicate the above optimal bundle in a graph (You don't need to be very accurate).

Reference no: EM13488694

Questions Cloud

Describe the reaction must be spontaneous regardless : For a certain chemical reaction, DH is

Determine the current assets : The current asset section of the Excalibur Tire Company's balance sheet consists of cash, marketable securities, accounts receivable and inventories.

Income statement in the contribution format : How many units would have to be sold during 2013 to earn a target profit of $59,000 for the year and Show both a total column and a per unit column on your statement

Determine the density of the oil : A block of wood floats on water. 80% of the wood is submerged in water. Now a layer of oil is carefully poured on top of the water to a depth that more than covers the block. what is the density of the oil

Enjoys goods x and y according to the utility function : Mr. J enjoys goods x and y according to the utility function

Which situation does pam prefer : Will Pam be able to buy and want to buy 30 cookies and 5 granola bars next week?

Requirements of section 404 : Research a public company and explain how management reports on internal control in order to meet the requirements of Section 404.

Difference in treatment of identifiable and unidentifiable : How much depreciation will be taken each year if the straight-line method of depreciation is used? Show calculations. "

What is the index of refraction for deep violet light : A narrow beam of white light is incident at 30? on a 11.0cm -thick piece of glass. What is the index of refraction for deep violet light

User Account

All Pages