Order the answer to: Nadia spends her money on cheese pizza and frozen yogurt.

Order the answer to: Nadia spends her money on…

Question	Nadia spends her money on cheese pizza and frozen yogurt. Her utility function is U(C, F) = (C + 2) x (F + 3), where C represents ounces of cheese pizza and F represents pints of frozen yogurt consumed in a week. For this utility function, MUC =F + 3 and MUF = C + 2. Her weekly income is $20, the price of pizza is $1 per ounce, and the price of yogurt is $2 per pint. What is Nadia’s MRSFC? Do her preferences satisfy the declining MRS property? What is her best choice? How much would we have to pay Nadia to compensate her for doing without any pizza for a week?
Subject	business-economics

Question

Nadia spends her money on cheese pizza and frozen yogurt. Her utility function is U(C, F) = (C + 2) x (F + 3), where C represents ounces of cheese pizza and F represents pints of frozen yogurt consumed in a week. For this utility function, MUC =F + 3 and MUF = C + 2. Her weekly income is $20, the price of pizza is $1 per ounce, and the price of yogurt is $2 per pint. What is Nadia’s MRSFC? Do her preferences satisfy the declining MRS property? What is her best choice? How much would we have to pay Nadia to compensate her for doing without any pizza for a week?

Subject

business-economics

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