Jess has the utility function U(x₁, x₂) = min{3x1, 6x2}. The price of x₁ is px₁, Px₂, and his income is m. 1. Find Jess's optimal bundle x* and x as a function of Px₁, P₂, and m. 2. What's the proportion of consumption amounts between x and x? In other words, find 3. Suppose instead the utility function is U(x₁, x2) = min{2x₁, 3/3}. Without solving for the x* the price of x2 is .
Jess has the utility function U(x₁, x₂) = min{3x1, 6x2}. The price of x₁ is px₁, Px₂, and his income is m. 1. Find Jess's optimal bundle x* and x as a function of Px₁, P₂, and m. 2. What's the proportion of consumption amounts between x and x? In other words, find 3. Suppose instead the utility function is U(x₁, x2) = min{2x₁, 3/3}. Without solving for the x* the price of x2 is .
Chapter7: Consumer Choice: Maximizing Utility And Behavioral Economics
Section: Chapter Questions
Problem 6QP
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