Order the answer to: Antonio’s utility function for the…
| Question | Antonio’s utility function for the goods X and Y is U(X, Y) = 2(?X + ?Y). a. What is his MRSXY? Do his preferences satisfy the declining MRS property? b. Suppose his monthly income is $1800 and X and Y both cost $1 per unit. What is his best choice? c. Suppose the price of good X rises to $2 per unit. What is his new best choice? Decompose the change in his purchases into substitution and income effects. What is his compensating variation for the price change? |
|---|---|
| Subject | business-economics |
Have a writer answer this question by clicking below. If you have any questions you can contact us via live chat.
