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What kind of preferences does mark have

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1. Mark is in a bookstore and has $120 to spend on books (XB) and DVDs (XD). Each book costs Mark $6 and each DVD costs $20. Since Mark views both as entertainment and can only use one at a time, he considers books and DVDs to be completely interchangeable. His utility function over books and DVDs is u(X8, Xp) = 12xg + 15xp.

a. What kind of preferences does Mark have?

b. What is Mark's optimal choice? How much utility does Mark get from that optimal choice?

Reference no: EM133133399

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