Optimal choice between movie and hamburger

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Suppose that Ben has $90 to spend on two goods, movie (M) and hamburger (H). The price of a movie is $10 and the price of a hamburger is $2. Ben’s preferences are represented by the utility function: U(M, H) = M *H^2 .

(a) What is Ben’s optimal choice between movie and hamburger?

(b) Suppose that the price of hamburger rises to $5. How will this change Ben’s decision?

Reference no: EM13833291

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