Identify his utility-maximizing point

Reference no: EM133094432

Question: Jeremy is deeply in love with Jasmine. Jasmine lives where cell phone coverage is poor, so he can either call her on the land-line phone for five cents per minute or he can drive to see her, at a round-trip cost of $2 in gasoline money.

He has a total of $10 per week to spend on staying in touch. To make his preferred choice, Jeremy uses a handy utilimometer that measures his total utility from personal visits and from phone minutes.

Using the values given in the table below, figure out the points on Jeremy's consumption choice budget constraint (it may be helpful to do a sketch) and identify his utility-maximizing point.

Round Trips	Total Utility	Phone Minutes	Total Utility
0	0	0	0
1	80	20	200
2	150	40	380
3	210	60	540
4	260	80	680
5	300	100	800 900
6	330	120	800 900
7	200	140	980
8	180	160	1040
9	160	180	1080
10	140	200	1100

Reference no: EM133094432

Questions Cloud

Challenges of implementing e-reservations in healthcare : The potential benefits and challenges of implementing e-Reservations in the healthcare setting.

Someone has to go-a tough layoff decision : What makes this decision so difficult for Martinez? What should be included in the outplacement (severance) package?

Awareness of risk factors and prevention result : Does Early Mammogram Screening/ Awareness of Risk Factors and Prevention Result in Improved Breast Cancer Patient Outcome? describe the independent and dependen

Who is an influential philosopher on ethical values : Who is an influential philosopher on ethical values?

Identify his utility-maximizing point : Land-line phone for five cents per minute or he can drive to see her, at a round-trip cost of $2 in gasoline money - points on Jeremy's consumption choice

Develop strategic plan for incorporating goal : Develop a strategic plan for incorporating this goal in your health information system proposal of contracting with a telepsychiatry hospital network

Organizations compares to planning in organization : How do you think planning in today's organizations compares to planning in an organization 25 years ago?

International logistics services : You have chosen a country for the Walmart Case Study. International Logistics Services (ILS) has acquired a new warehouse

Record the entry when the bonds are issued : The bonds sell at a price of 101; Loon uses the straight-line method of amortizing bond discount/premium. Record the entry when the bonds are issued

User Account

All Pages