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28 Sep 2019
Nick's utility is given by the formula U(b,p)=4b2+4bp2+p4 where b is the quantity of beer he drinks and p is the quantity of pizza he eats.
1. Calculate Nick's marginal utility of beer and the marginal utility of pizza. Does Nick have diminishing marginal utilities?
2. Derive Nick's MRS (think of a diagram measuring pizza on the horizontal axis). What is the slope of the indifference curve at the point (10,10)?
3. Check whether Nick's indifference curves are convex.
4. Alex's utility function is given by U(b,p)= 6b+ 3p2+1.23252523423987 . Redo questions 1,2 and 3 for Alex.
Nick's utility is given by the formula U(b,p)=4b2+4bp2+p4 where b is the quantity of beer he drinks and p is the quantity of pizza he eats.
1. Calculate Nick's marginal utility of beer and the marginal utility of pizza. Does Nick have diminishing marginal utilities?
2. Derive Nick's MRS (think of a diagram measuring pizza on the horizontal axis). What is the slope of the indifference curve at the point (10,10)?
3. Check whether Nick's indifference curves are convex.
4. Alex's utility function is given by U(b,p)= 6b+ 3p2+1.23252523423987 . Redo questions 1,2 and 3 for Alex.
Joshua StredderLv10
28 Sep 2019
