Reference no: EM13224515
Suppose Alex's utility function for tops (x) and candy (z) is: U(x,z)= x¾ z¼ . Suppose this year she has income of 1,000 to spend on these two goods. The price of a unit of x is $25 and the price of a unit of z is $5. Her marginal utility of x is MUx= 3z¼ /4x¼ . Her marginal utility of z is MUz= x¾/ 4z¾
a) With z on the verticle axis, what is the equation for her marginal rate of substitution?
b) With z on the left hand side of the equation, what is the equation for her budget constraint?
c) What is the equation for her marginal rate of transformation?
d) Use this information to solve for Alex's optimal amount of x per year
e) what is Alex's optimal amount of z per year?
f) Now suppose Alex's income increases to $1,500 per year. What is her new optimal consumption of x?
g) What is her new optimal consumption of z?
|
Washington mutual bank failure
: Washington Mutual Bank Failure- Describe how specific organizational behavior theories could have predicted or explained the company's failure
|
|
Explain the volume and temperature changes
: Determine Ssys separately for the volume and temperature changes and show that ?Ssys = 0 for a reversible adiabatic process.
|
|
Write the equation for the firms marginal revenue
: If this was a competitive industry, the resulting quantity would be where P = MC. Solve for the competitive quantity (Q C) and price (P C). Hint: set P = MC to solve for Q, then plug Q into either P or MC equation.
|
|
Objective function coefficient for variable
: What will happen to the solution if the objective function coefficient for variable 1 decreases by 20? Nothing. The values of the decision variables, the dual prices, and the objective function will all remain the same. The value of the objective fu..
|
|
What is the equation for the budget constraint
: Suppose Alex's utility function for tops (x) and candy (z) is: U(x,z)= x¾ z¼ . Suppose this year she has income of 1,000 to spend on these two goods. The price of a unit of x is $25 and the price of a unit of z is $5. Her marginal utility of x is ..
|
|
Calculate the overall coefficient of performance
: The family estimates that it will take an average of 21 GJ of energy per month to keep the house heated to this temperature for 5 cold months. The cost of electrical energy is $0.185/kWh (kilowatt-hour).
|
|
What will happen in the market for personal computers
: If the price of processor chips used in manufacturing personal computers decrease, what will happen in the market for personal computers How will the equilibrium price and equilibrium quantity of personal computers change
|
|
Objectives and purpose of workers compensation legislation
: Discuss agency from the point of view of actual, implied, and apparent authority, estoppel, fiduciary duty, breach of duty, ratification, and vicarious liability and explain how the court will determine whether a person is an ..
|
|
What were the total dividends paid to shareholders
: In its most recent financial statements, Newhouse Inc. reported $50 million of net Statement of income and $810 million of retained earnings. The previous year, its balance related earnings sheet showed $780 million of retained earnings.
|