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Two goods: x, y. Julie has the utility function u(x, y) = x(y 2). The price of x is $2 and the price of y
Two goods: x, y. Julie has the utility function u(x, y) = x(y 2). The price of x is $2 and the price of y is $1. Income m = $120. The marginal utilities are MUx = y 2 and MUy = x. a. (2pts) Find the marginal rate of substitution MRSx, y as a function of x and y. b. (4pts) Use the tangency condition and the budget equation to find Max's demand for good x and good y
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