Find chris demand curve for macadamia nuts

Reference no: EM133279197

Question - Chris snacks on cashews (x) and macadamia nuts (y) when he watches TV. His preferences can be represented by the utility function U(x,y) = 2ln x + 4ln y where x represents the number of pounds of cashews and y represents the number of pounds of macadamia nuts.

a) Given his preferences find his demand functions for cashews (x) and macadamia nuts (y).

b) Suppose that the price of a pound of cashews is $5 and that Chris has $45 to spend on cashews and macadamia nuts. Find Chris's demand curve for macadamia nuts. Illustrate his demand curve in a diagram.

c) Suppose that the price of a pound of macadamia nuts is $10 (the price of cashews and income remain $5 and $45, resp.). Use your demand functions to find his best bundle. Illustrate his best bundle at these prices.

Reference no: EM133279197

Questions Cloud

What is the name given to bonnie particular preferences : What is the name given to Bonnie's particular preferences? On a graph, draw the indifference curve that passes through bundle (3,3)

What type of price control has china imposed : What type of price control has China imposed, according to the information above? Explain the impact of China's price control policy on the markets for coal

What is the quantity of labor supplied : If the consumer faces a wage rate of w=30, how much leisure and purchased goods do they consume? What is the quantity of labor supplied

What are the equilibrium price and quantity : Suppose a company has invented and patented a new effective drug to treat hay fever. What are the equilibrium price and quantity

Find chris demand curve for macadamia nuts : Chris has $45 to spend on cashews and macadamia nuts. Find Chris's demand curve for macadamia nuts. Illustrate his demand curve in a diagram

What would the yearly opportunity cost : Given the information? above, if the interest rate on your savings account was 2 percent a? year, then what would the yearly opportunity cost

What is the defense of the news paper : Yeagle sued the Collegiate Times for defamation. Does she have a case? What is the defense of the news paper

How government intervention affects the supply and demand : Describe how government intervention affects the supply and demand equilibrium. Refer to the simulation game to explain your responses

Apply the strategic management concepts : BUS409 Strategic Management apply the strategic management concepts that arelearned from the course - These organizations range from large to small companies

User Account

All Pages