Draw bills in difference map

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Reference no: EM13861831

Suppose that Bill cares only about chai and bagels. Her utility function is U=CB, where C is the number of cups of chai she drinks in a day, and B is the number of bagels she eats in a day. The price of chai is $2, and the price of bagels is $1.50. Bill has $6 to spend per day on chai and bagels.

C) Draw Bills in difference MAP

D) Set up Bills optimization problem.

E) Find the partial derivatives of L w.r.t C,B, and lamda

F) Set the partial derivatives of L w.r.t. C,B, and lamda each =0: This will give you three equations and three unknowns. Solve for C, and B.

Reference no: EM13861831

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