Problem PS3.4.1

Mike likes beer and fried chicken and views them as perfect complements: for each bottle of beer, he likes to eat 3 pieces of fried chicken. An excess beer that is not paired with 3 pieces of fried chicken gives him no utility, and an excess piece of fried chicken that is not paired with a third of a beer gives him no utility.

What is Mike's utility function for beer (B) and chicken (C)?

U(B,C)=min{3B,C}

None of these options

U(B,C)=3BC

U(B,C)=3B+C

U(B,C)=max{3B,C}

Problem PS3.4.2

Mike has a budget of $12 to spend on beer and chicken. A bottle of beer costs $6 and a piece of chicken costs $2. What is the optimal consumption bundle?

B=unanswered

C=unanswered

Problem PS3.4.3

The government imposes a tax on beer due to a health campaign, thereby increasing the price by 50%. What is the optimal consumption bundle now if Mike's consumption of beer and chicken can be a non-integer value?

B=unanswered

C=unanswered