What type of function is the utility function expressed as u(x,y)=30lnx + y? Also, how would you go about deriving the demand for x and y in this functi
Q: What type of function is the utility function expressed as u(x,y)=30lnx + y? Also, how would you go…
A: A utility function u (x, y) represents a consumer’s preferences. That is, a utility function…
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A: Since you have posted multiple questions, so as per answering guidelines, We will solve first…
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A: The given information:The utility function can be written as follows:
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What type of function is the utility function expressed as u(x,y)=30lnx + y? Also,
how would you go about deriving the
Step by step
Solved in 2 steps
- a) A consumer has a utility function given by U = x025 y0.75 He has an income of £100, the price of good x is £5 and the price of good y is £10. How much of the 2 goods x and y does the consumer buy? Take a picture of your workings and upload with your answer, or type out your workings. b) For the utility function above, what is the cross-price elasticity of demand for good x with respect to the price of good y? Take a picture of your workings and upload with your answer, or type out your workings. c) For the utility function above, what is the elasticity of demand of good x with respect to its own price? Take a picture of your workings and upload with your answer, or type out your workings.Ayana is pitching an idea for a startup company that makes and sells solar-powered phonechargers (C). Her market research has found that consumer demand for this product can beexpressed as a function of the price of the charger itself (PC), the price of phones (PF), andthe consmer’s income (I). Consumer demand can be described by the function C(PC, PF, I) =(i−10PC)/ (PF) Suppose her chargers come in all different capacities to meet any quantity demanded, so youdon’t need to worry about restricting C to whole numbers for this problem. (a) Does this product satisfy the law of demand?Explain.Jack sells 40 widgets when it charges a price of $40 per widget, and 10 widgets when it charges a price of $100 per widget. Assume the demand for widgets is linear. Write down the inverse demand function of Jack's customers.
- Ayana is pitching an idea for a startup company that makes and sells solar-powered phonechargers (C). Her market research has found that consumer demand for this product can beexpressed as a function of the price of the charger itself (PC), the price of phones (PF), andthe consmer’s income (I). Consumer demand can be described by the function C(PC, PF, I) =(i−10PC)/ (PF) Suppose her chargers come in all different capacities to meet any quantity demanded, so youdon’t need to worry about restricting C to whole numbers for this problem. (a) Does this product satisfy the law of demand?Explain. (b) Calculate consumers’ income elasticity as a function of the parameters. (c) Anaya is targeting a market whose income is expected to double over the next five years.Explain whether she should expect the demand for chargers to increase or decrease, andby how much, using the language of normal, inferior, luxury, and necessity goods. (d) Calculate the cross-price elasticity ofCwith respect toPF. (e)…Suppose consumers A and B have the following demand functions for x: For each consumer, is x is a normal good or an inferior good? Explain why.The demand function for a particular good is x = a + bp. What are the associated direct and indirect utility functions?
- Ravi's utility function for various combinations of X and Y satisfy all the axioms of choice. Given his budget constraint, it has also been observed that the cross-price elasticity of demand between X and Y is zero as the price of X falls. Given this scenario, comment with an appropriate diagram, what kind of commodity is Y?Suppose the weighted marginal utility for two goods x and y at a position of consumer equilibrium 70. If the price of good x is r10 and the relevant marginal utility for y is 140 what is the price of good y and the relevant marginal utility for xShow that the two utility functions given below generate identical demand functions for goods X and Y: (1) U(X,Y) = log(X) + log(Y) (2) U(x,y) = (XY)0.5 What is the demand function for good X and Y for both utility functions?
- if consumers would expect the price of a good to increase in the near future in the price of a complement good to decrease at the same time what would happenhow do you find the marginal utilities of the goods with the information provided?The term “law of diminishing marginal utility” used in explaining downward sloping demand curves, others things constant, is best described by which of the following statements? The total satisfaction you obtain from consuming a good tends to fall. The average satisfaction you obtain from consuming a good tends to fall. The additional satisfaction you obtain from consuming an additional unit of a good tends to fall. The total satisfaction you obtain from the good tends to rise.
