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A households utility function is given by U(x, y, z) = 6 In x + 9 ln y + 15 In z, where x,y and z are the quantities of prodQuestion 11 2 pts This continues the previous problem. The ratios x* /y*, y* /z* and z* /a* of the utility maximizing quantit

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Answer #1

constant, they don't change when the budget changes

(Utility is maximized at the bundle where MRSx,y = MRSy,z = MRSz,x = price ratio of the goods
MRSx,y = MUx/MUy = 6/ 2y 9/

MRSy,z = MUy/MUz = 9/9 亚=15/ 2 32 59

MRSz,x = MUz/MUx = 15/2 52 6/1 = 22

So, ratio of all these variable depends on the price ratio and not the budget. Thus, they remain constant when the budget changes.

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