Question
Marius has the following utility function: U (X, Y) = 20X + 80 Y - X 2 -2Y 2 , X being the CD number,
Marius has the following utility function:
U (X, Y) = 20X + 80 Y - X2 -2Y2, X being the CD number, at 100 kr per piece, and Y is DVD number at 150 kr cost per piece. He wants to use 4500 kr for both CD and DVD. How much will he buy from each of them, given that he wants to maximise his usefulness?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Microeconomics
Authors: Douglas Bernheim, Michael Whinston
2nd edition
73375853, 978-0073375854
