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Given the Utility function U(X,Y) = X^0.5 + Y^0.5 Create a mathematical expressions for marginal utility of x and marginal utility ofy Does the consumer
Given the Utility function U(X,Y) = X^0.5 + Y^0.5
- Create a mathematical expressions for marginal utility of x and marginal utility ofy
- Does the consumer the assumption of non-satiation (more is better) desire more of x and y?
- If the quantity of Y is held constant, does the marginal utility of x increase, remain constant or diminish as x increases? Prove your answer
- Derive an expression for the marginal rate of substitution of x for y.
- If Price of X equals 1 and price of Y equals 1 and income equals $200, what utility maximizing quantity of x and quantity of y will the consumer choose.
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