Question

Calculate the MRS for the following three utility functions: ·U(x,y) = xy . U(x,y) = lnx + lny . U(x, y) = x2y2 Is the result suprising? If yes, try to explain it.
0 0
Add a comment Improve this question Transcribed image text
Request Professional Answer

Request Answer!

We need at least 10 more requests to produce the answer.

0 / 10 have requested this problem solution

The more requests, the faster the answer.

Request! (Login Required)


All students who have requested the answer will be notified once they are available.
Know the answer?
Add Answer to:
Calculate the MRS for the following three utility functions: ·U(x,y) = xy . U(x,y) = lnx...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Similar Homework Help Questions
  • For U(x,y) -xy, MRS ▼ , while Uxx_ and Uyy This means that this utility function...

    For U(x,y) -xy, MRS ▼ , while Uxx_ and Uyy This means that this utility function has MRS, while exhibiting marginal utility in x andy For U(x,y)-x2y2, MRS ▼ , while Uxx_ and Uyy This means that this utility function has MRS, while exhibiting marginal utility in x and y For U(x,y) = In x + In y, MRS- ,while Ux- and Uyy ▼ . This means that this utility function has MRS, while exhibiting marginal utility in x and...

  • consider a quasi-linear utility function: U(x, y) = lnx + y. Show that the MRS is...

    consider a quasi-linear utility function: U(x, y) = lnx + y. Show that the MRS is the same on all indifference curves at a given x. Illustrate your result in a suitable diagram. please show all steps, so I can better understand how you reached your final answer.

  • 2. Show that each of the following utility functions has a diminishing MRS. Do they exhibit...

    2. Show that each of the following utility functions has a diminishing MRS. Do they exhibit constant, increasing, or decreasing marginal utility? Is the shape of the marginal utility function an indicator of the convexity of indifference curve? a. (2) U(X,Y) = XY b. (2) U(X,Y) = x2y2 c. (2) U(X,Y) = In X + In Y

  • Let say the utility function as U(X,Y) = lnX + Y. Show that the marginal rate...

    Let say the utility function as U(X,Y) = lnX + Y. Show that the marginal rate of substitution (MRS) is the same on all of the indifference curves at a given X. Explain and include graph. (5 Marks)

  • A) Let utility over 2 goods be defined as U(x,y)=x+xy+y. Find the MRS by implicitly solving...

    A) Let utility over 2 goods be defined as U(x,y)=x+xy+y. Find the MRS by implicitly solving for y (hint: set U=k) and calculate -dy/dx. B) Now find the MRS by using MRS =Ux/Uy.

  •    For each of these utility functions,   b. Compute the MRS. c. Do these tastes have...

       For each of these utility functions,   b. Compute the MRS. c. Do these tastes have diminishing marginal rates of substitution? Are they convex? d. Construct an indifference curve for each of these functions for utility numbers U1 = 10 , U2 = 100 , U3 = 200 . e. Do these utility functions represent different preference orderings? 1. Consider the following utility functions: (i) U(x,y)- 6xy, (ii) U(x,y)=(1/5)xy, MU,--y and MU,--x ii) U(x,y)-(2xy)M 8xy2 and MUy -8x2y MU,-6y and...

  • A consumer of two goods (X and Y) has the following utility function: U(x,y)=xy-ay^2, whre x>=0...

    A consumer of two goods (X and Y) has the following utility function: U(x,y)=xy-ay^2, whre x>=0 and y>=0 and a>0 is a parameter. (a) Are there bundles for which one of the goods is actually a "bad" (in the sense that consuming more of it reduces utility)? (b) Find the MRS.

  • Show Working please 3. Calculate the MRS for EACH of the following utility functions. (Remember MRS...

    Show Working please 3. Calculate the MRS for EACH of the following utility functions. (Remember MRS is always negative with a downward sloping indifference curve) a. U (x1,x2) = 3x1 + 4x2 b. U (x1,x2) = 3x1x3 c. U (x1, x2) = 4x - 4x2 d. U (x1, x2) = 16x{ x e. U(x,y) = 2 Vx+2,77 f. U(x,y) = 3x2 /y g. U(x,y) = 16x4y3 4. Explain the following in words making reference to the indifference curve. a. (3,3)...

  • Use the following table to indicate whether the marginal rate of substitution (MRS) of each utility...

    Use the following table to indicate whether the marginal rate of substitution (MRS) of each utility function increases, decreases, or is constant as x increases. MRS Increases with Utility Function Ux,y)- 3x y U(x,y) = MRS Decreases with x Constant MRS MRS Increases withx x-y U(x,y) = For a utility function for two goods, U xy to have a strictly diminishing MRS ie, to be strictly quasi concave), the following condition must hold: Use the following table to indicate whether...

  • Problem 1 (10pts) Jim's utility function is U (x, y) = xy. Jerry's utility function is...

    Problem 1 (10pts) Jim's utility function is U (x, y) = xy. Jerry's utility function is U (x,y) = 1,000xy +2,000. Tammy's utility function is U2, y) = xy(1 - xy). Bob's utility function is U(x,y) = -1/(10+ 2xy). Mark's utility function is U (2,y) = x(y + 1,000). Pat's utility function is U (2,y) = 0.5cy - 10,000. Billy's utility function is U (x,y) = x/y. Francis' utility function is U (x,y) = -ry. a. Who has the same...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT