Calculate the mrs or the marginal rate of substitution

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Sam’s utility function over goods X and Y is considered to be

U(X,Y) = 10X +5Y

His income is $100 and the price of X is $2 and the price of Y is $5.

a) Calculate the MRS or the marginal rate of substitution between X and Y.

b) How much X and Y will Sam buy to maximize his utility given his budget constraint and the prices of X and Y?

Reference no: EM13743912

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