What is the maximum value of px

Assignment Help Financial Management
Reference no: EM13978799

1. Suppose that a consumer's utility function is U(x,y)= xy + 10y. The marginal utilities for this utility function are MUx= y and MUy = x+10. The price of good x is Px and the price of good y is Py, with both prices positive. The consumer has income I. 
Suppose now that income is $100, I=100. Since the amount of good x can never be negative, what is the maximum value of Px for which the consumer could ever purchase ever purchase any of good x?

Reference no: EM13978799

Questions Cloud

Who is your representative to the california assembly : Who is your representative to the California Senate? (include a link to their website) How long have they been in office? What is their party affiliation
Compute the magnitude and direction of the electric field : When each sheet has a uniform surface charge density Sigma = + 2.4 nC/m2, determine the magnitude and direction of the electric field in region I, to the left of the left-most sheet.
What is the expected dividend each year for next four year : Hair Re-Growth Company has developed a new product and is selling its product as fast it can be produced. As a result, the company is predicting growth of 20% per year for the next four years. What is the expected dividend each year for the next four..
Change in net working capital calculation : Samuels Manufacturing is considering the purchase of a new machine to replace one it believes is obsoletes. The firm has total current assets of $910,000 and total current liabilities of $647,000. As a result of the proposed replacement, the follo..
What is the maximum value of px : Suppose that a consumer's utility function is U(x,y)= xy + 10y. The marginal utilities for this utility function are MUx= y and MUy = x+10. The price of good x is Px and the price of good y is Py, with both prices positive. The consumer has income I
The financial plan : The financial plan
The most important number determined in the financial plan : The most important number determined in the financial plan is
Determine approximately the speed of the rocket : A test rocket is fired vertically from a launching pad at B. When the rocket is at P the angle of elevation ion is θ=47.0°, and 0.5 s later it is θ = 48.0° . Knowing that b = 4 km, determine approximately the speed of the rocket during the 0.5-s inte..
Explain the subdivisions of information systems management : How is the separation of the programming and operating functions accomplished in a properly functioning IT environment - Explain the three subdivisions of information systems management

Reviews

Write a Review

Financial Management Questions & Answers

  What happens to the expected return on the stock

The common stock and debt of Northern Sludge are valued at $70 million and $30 million, respectively. Investors currently require a return of 16.0% on the common stock and 7.7% on the debt. If Northern Sludge issues an additional $13 million of commo..

  How can investors deal with different degrees of risk

Why are investors risk-averse? How can investors deal with different degrees of risk? What is the expected return on a portfolio? How can the expected return on a portfolio be manipulated to minimize the risk on that portfolio? What is the beta coeff..

  What it perceives as a market trend toward lower rates

Interest Rate Swap. Reeber, a US based MNC, wishes to transform its liability from fixed to floating in order to exploit what it perceives as a market trend toward lower rates. Its investment banker locates a (USD) fixed to floating swap quoted at 5...

  Analysis of the investment

Analysis of the Investment,  To prepare for this Individual Assignment: Review the Anthony's Orchard case study in the unit resources.

  Should investors care about a multinational firm

Should investors care about a multinational firm's accounting exposure - Accounting exposure is any exposure of a multinational firm's consolidated financial statements to exchange rate movements.

  Maximizing shareholder wealth and never paying bribes

Is there a conflict between maximizing shareholder wealth and never paying bribes when doing business abroad? If so, how might you explain the firm's position to shareholders asking why the company does not pay bribes when its foreign competitors in ..

  What is the future value of an annuity

What is the future value of an annuity where $3,000 is deposited every 6 months for 8 years, and earns interest at 12 percent compounded semi-annually?

  What is the preferred stock price if the required rate

An issue of preferred stock is paying an annual dividend of $5. The growth rate for the firms common stock is $14. What is the preferred stock price if the required rate of return is 11%.

  Maintains a debt-equity ratio

Merlo, Inc. maintains a debt-equity ratio of 0.25 and follows a residual dividend policy. The company has after-tax earnings of $3,800 for the year and needs $3,200 for new investments. What is the total amount Merlo will pay out in dividends this ye..

  Calculate the price of no growth stock

Calculate the price of a ‘no growth’ stock using the following characteristics: (a) Dividend: $4.56 and (b) Required Rate: 13%. Calculate the required rate of return on a stock with the following characteristics: (a) Price: $56.05 and (b) Dividend $5..

  What is the return of the equity in each case

Suppose she funds the project by borrowing $750 rather than $500. a. According to MM Proposition I, what is the value of the equity? What are its cash flows if the economy is strong? What are its cash flows if the economy is weak? b. What is the retu..

  What was the net income

Computer World Inc paid out $22.5 million in total common dividends and reported $278.9 million of retained earnings at year end. The prior year's retained earnings were $212.3 million. What was the net income? Assume all the dividends were actually ..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd