Asked by
megan eldridge
on Oct 14, 2024Verified
Ambrose's utility function is 4x1/21 x2.If the price of nuts (good 1) is $1, the price of berries (good 2) is $7, and his income is $259, how many units of berries will Ambrose choose?
A) 8
B) 197
C) 9
D) 18
E) 12
Utility Function
A mathematical representation that ranks preferences or satisfaction levels of a consumer for different bundles of goods.
Budget Constraint
A representation of all the combinations of goods and services a consumer can afford to buy with their income.
Nuts
Hard-shelled seeds of certain plants that are generally edible and nutritious, often eaten raw, roasted, or used as ingredients in cooking.
- Implement the utility maximization concept to find ideal consumption pairings.
- Investigate the influence of pricing adjustments on purchasing preferences.
Verified Answer
CM
Learning Objectives
- Implement the utility maximization concept to find ideal consumption pairings.
- Investigate the influence of pricing adjustments on purchasing preferences.