Order the answer to: Sarah’s preferences can be described by the utility function U(X,

Order the answer to: Sarah’s preferences can be described…

Question	Sarah’s preferences can be described by the utility function U(X, Y) = X2 + Y2. What is her MRSXY? Do her preferences have the declining MRS property? Draw the indifference curve corresponding to a utility level of 1 (that is, combinations of X and Y such that U(X, Y) = 1). If PX = 1, PY = 2, and M = 100, at what consumption bundle is her budget line tangent to an indifference curve? What is her best choice? Is there a difference and, if so, why?
Subject	business-economics

Question

Sarah’s preferences can be described by the utility function U(X, Y) = X2 + Y2. What is her MRSXY? Do her preferences have the declining MRS property? Draw the indifference curve corresponding to a utility level of 1 (that is, combinations of X and Y such that U(X, Y) = 1). If PX = 1, PY = 2, and M = 100, at what consumption bundle is her budget line tangent to an indifference curve? What is her best choice? Is there a difference and, if so, why?

Subject

business-economics

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