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help! 8a,b,c MUST SHOW YOUR WORK LEADING TO YOUR ANSWERS IN ORDER TO RECEIVE FULL CREDIT FOR THE QUESTION. Scenario: For being such good students,
help! 8a,b,c
MUST SHOW YOUR WORK LEADING TO YOUR ANSWERS IN ORDER TO RECEIVE FULL CREDIT FOR THE QUESTION. Scenario: For being such good students, Halimi is treating you to Pizza and Beer. Each student is given a $50.00 Downtown Chico Gift Card to purchase slices of Pizza and cold glasses of Beer. A slice of Pizza costs $3.50, while a cold glass of Beer costs $5.00. Halimi is concerned that you may spend it all on Beer, since you get 3 units of Utility from a glass of Beer and only 1 unit of Utility from a slice of Pizza. To make sure you don't end up with a hangover, Halimi has restricted you to consuming at least one slice of Pizza for every two glasses of Beer. Objective: You want to maximize your Utility and want to find out how many slices of Pizza (P) and how many glasses of Beer (B) to order (no partial glasses of Beer or partial slices of Pizza sold). 1. Define your Decision Variables - 2 Points 2. State the Objective Function - 3 Points 3. State the Constraint Equations - 6 Points 4. Solve by Corner Point Solution Method a. State all the Corner Coordinates - 4 Points b. Show which Corner is the optimal solution - 2 Points 5. State the optimum number of slices of Pizza and number of glasses of Beer to order -4 Points 6. How many units of Utility will you end up with?- 2 Points 7. Calculate the Slack-2 Points 8. If you could borrow some money to add to your Slack and use it to increase your Utility, answer the following questions: a. What is the minimum you would want to borrow?- 2 Points b. What would you do with the amount borrowed? - 2 Points c. What would be the marginal Utility gained per dollar borrowed? - 1 PointsStep by Step Solution
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