User Account

All Pages

Calculate tom utility-maximizing purchases

Assignment Help Business Economics
Reference no: EM132132699

Tom's income is $480and he spends it on two goods, X and Y. His utility function is U = XY. Both X and Y sells for $8 per unit.  

a. Use lagrangian function to calculate Tom's utility-maximizing purchases of X and Y. 

b. If the price of Y increased to $11.52, with no change in the price of X, by how much would his income have to increase to enable him to maintain his initial level of utility as in part (a) above?

Reference no: EM132132699

Questions Cloud

What techniques did you use to identify these : You are the project manager for an upgrade of computers in your company. You need to upgrade 30 systems, including 10 desktops.
Suppose there is no inflation and an insurance company : Suppose there is no inflation and an insurance company offers a contract that would pay $500,000 with certainty 50 years from now.
Compute the ending inventory : The records of Riverbed's Boutique report the following data for the month of April. Compute the ending inventory by the conventional retail inventory method
What solutions will you use to mitigate the risks : Different projects require different forms of risk management, even when the risk occurs again.
Calculate tom utility-maximizing purchases : Tom's income is $480and he spends it on two goods, X and Y. His utility function is U = XY. Both X and Y sells for $8 per unit.
Identify the sources of the growth : For this assignment, you need to choose an industry and then analyze the growth pattern of that industry during periods of recession and periods of expansion.
Income effects depend on the income elasticity of demand : If one of the goods you buy has a negative income elasticity, that is, it is an inferior good, what must be true of the income elasticity of the other good you
How was the organization impacted : How was the organization impacted? What losses did it suffer? Describe the disaster recovery and business continuity that the business had in place?
Calculate the break-even in dollars : Calculate the break-even in dollars given the following information: Sales per unit of $40, variable costs of $15, fixed costs of $15,000

Reviews

Write a Review

Business Economics Questions & Answers

  Economics assignment

This document contains various important questions and their appropriate answers in the subject field of Economics.

  Demand and supply curves

Economics is the study of the principles governing the allocation of scarce means among competing ends when the objective of the allocation is to maximize the attainment of the ends.

  Long-run perfectly competitive equilibrium for the firm

Evaluate Government intervene and correct this situation?(a) Explain the concept of a concentration ratio. A rise in the price of magarine Explain the impact of external costs and external benefits on resource allocation long-run perfectly c..

  Supply and demand diagrams

Explain each of the following using supply and demand diagrams,  With the use of a graph, explain how these two programs affect cigarette consumption and the price of cigarettes.

  Case study: fisher-price toys

The case study of the Fisher-Price Toys, Inc., a popular case in basic economics and management from the prestigious Harvard Business School.

  Draw the production possibility curve

Draw the production possibility curve and a. Define consumer surplus and producer surplus.

  Tax revenue

The Australian government administers two programs that affect the market for cigarettes

  Maximize total welfare

How many tickets to sell to maximize total welfare.

  Difference between the cv and the ev

The change in consumer surplus (?CS) is not "theoretically" justifiable like the CV and EV but it continues to be the most widely used measure of consumer welfare change. Explain how this can be reconciled

  Depict von neumann-morgenstern utility index u in a diagram

Depict the von Neumann-Morgenstern utility index u in a diagram

  What is the market solution

What is the market solution (market price and quantity) and What is the total surplus of the society under the market solution

  Calculate gross national product and net national product

Calculate gross national product and net national product

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +91-977-207-8620

Phone: +91-977-207-8620

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd