Find the amount of cash that the grandmother

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Paul consumes only two goods, pizza (P) and hamburgers (H), and his utility function is given by U(P, H) = P + 4H. The price of pizza is $3 and the price of hamburgers is $6, and Paul's income is $300. Knowing that he likes pizza, Paul's grandmother gives him a birthday gift certificate of $60 redeemable only at Pizza Hut. Though Paul is happy to get this gift, his grandmother could have made him exactly as happy by spending far less than she did. Find the amount of cash that the grandmother could give to make Paul just as well off as with the pizza certificate.

Reference no: EM132243874

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