Allocate budget to total utility, Marketing Management

Assignment Help:

Jack is deciding how to spend the $6 budget he has allocated for today's telephone calls.  There are only two people he intends to call:  his girlfriend Jill, and his old high school friend, Steve.  Jack's love for Jill is such that he could talk to her forever; the marginal utility of a minute talking to Jill is a constant ten utils, regardless of the number of minutes he talks.  Steve usually has a lot of interesting news, but he becomes dull and boring after awhile; the marginal utility of talking to Steve is given by the equation:

                                                      MU = 60 - 2M

      where M is the number of minutes they have talked so far.  So, the first minute gives Jack 58 utils, the second minute gives him 56 utils, etc.

      It costs 5 cents per minute to call Jill, and 10 cents per minute to call Steve, who lives farther away. 

      How should Jack allocate his budget of $6 to maximize his total utility?  In other words, how many minutes should Jack spend talking to Steve today, and how many minutes talking to Jill?


Related Discussions:- Allocate budget to total utility

Explain the term business to business advertisement, Explain the term Busin...

Explain the term Business-to-Business Advertisement with examples. Business-to-Business Advertisement: • Promote plant & machinery, raw materials, spares etc. • Technic

What is the importance of teamwork, Question: Whether in the workplace ...

Question: Whether in the workplace or on the football field, or amongst members of a community and especially in the service industry, effective teamwork produce incredible res

Building new knowledge through research and development, Question : (a)...

Question : (a) "America's investors are as busy as they have ever been and its entrepreneurs are seizing on their ideas with the same alacrity as always. Investment in resear

Case study, 1. What are the significant factors that have led to the succes...

1. What are the significant factors that have led to the success of Shoppers’ Stop? 2. Draw the typical profile(s) of Shoppers’ Stop customer segments.

Add two five-byte numbers using arrays, Program: Add two five-byte numbers ...

Program: Add two five-byte numbers using arrays ; ALGORITHM: ;           Make count = LEN ;           Clear the carry flag ;           Load address of NUM1 ;

Differentiating between Services and Goods, Differentiate between Services ...

Differentiate between Services and Goods and explain the areas in which the attributes of services create needs in the marketing mix?

What range of activities incorporates in green marketing, What range of act...

What range of activities incorporates in green marketing? Green marketing incorporates an extensive range of activities, comprising product modification, packaging changes an

"How has your iPhone changed your career?", "How has your iPhone changed yo...

"How has your iPhone changed your career?" Please respond to the following: Identify two (2) technological innovations that have changed the fundamental manner in which companies

Elaborate the term brand in brief, Elaborate the term Brand in brief. ...

Elaborate the term Brand in brief. Brand: Brand is nothing but a method of creating an identity for a product somewhat as Amitabh Bachan whose name suggests a certain ide

Write Your Message!

Captcha
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