Question
Charlotte has $40 to spend on two goods, x1 and x2. Her utility function for these two goods is (1, 2) = 1 + 2.
Charlotte has $40 to spend on two goods, x1 and x2. Her utility function for these two goods is (1, 2) = 1 + 2. The price of each unit of good 1 is $2 and the price of good 2 is $20
(a) How many units of each good will Charlotte choose to maximize her utility?
(b) What must her income be in order to consume positive quantities of both goods?
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Intermediate Microeconomics
Authors: Hal R. Varian
9th edition
978-0393123975, 393123979, 393123960, 978-0393919677, 393919676, 978-0393123968
