How can alter purchases of hamburger and steak

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Question: 1. Bob is willing to trade one pound of steak for three pounds of hamburger. Bob currently exhausts his budget by purchasing equal amounts of steak and hamburger per month. The price of steak is twice that of hamburger.

a. Illustrate mathematically and graphically whether or not Bob is maximizing his utility with respect to steak and hamburgers and, if not, how he can alter his purchases of hamburger and steak to reach an optimum.

b. Depict Bob's current and optimal consumption bundle graphically with hamburger on the vertical axis and steak on the horizontal.

Reference no: EM132196960

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