Question

Alex’s preferences can be represented by the utility function U(xn, xb) = 4√xn + xb. • He originally consumed 9 units of nuts and 10 units of berries. His consumption of nuts is reduced to 4 units, but he is given enough berries so that he is just as well-off as he was before. After the change, how many units of berries does Alex consume? • If you doubled the amount of each good in each bundle, you would have bundles? • Are these two bundles on the same indifference curve? What is Alex’s marginal rate of substitution, MRS(xn, xb), when he is consuming the bundle (9, 10)? (Give a numerical answer.) • Imagine the price of nuts pn = 1, and pb = 2. What is his budget if he can afford the bundle (9, 10)? Can he afford the new bundle?

          Alex’s preferences can be represented by the utility function U(xn, xb) = 4√xn + xb.
• He originally consumed 9 units of nuts and 10 units of berries. His consumption of nuts is reduced to 4 units, but he is given enough berries so that he is just as well-off as he was before. After the change, how many units of berries does Alex consume?
• If you doubled the amount of each good in each bundle, you would have bundles?
• Are these two bundles on the same indifference curve? What is Alex’s marginal rate of substitution, MRS(xn, xb), when he is consuming the bundle (9, 10)? (Give a numerical answer.)
• Imagine the price of nuts pn = 1, and pb = 2. What is his budget if he can afford the bundle (9, 10)? Can he afford the new bundle?

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Added by Leroy B.

Principles of Economics

Gregory Mankiw 8th Edition

Instant Answer

Solved by Expert Crystal Wang

10/03/2023

Step 1

U(xn, xb) = 4√xn + xb U(9, 10) = 4√9 + 10 U(9, 10) = 4(3) + 10 U(9, 10) = 12 + 10 U(9, 10) = 22 Show more…

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Alex’s preferences can be represented by the utility function U(xn, xb) = 4√xn + xb. • He originally consumed 9 units of nuts and 10 units of berries. His consumption of nuts is reduced to 4 units, but he is given enough berries so that he is just as well-off as he was before. After the change, how many units of berries does Alex consume? • If you doubled the amount of each good in each bundle, you would have bundles? • Are these two bundles on the same indifference curve? What is Alex’s marginal rate of substitution, MRS(xn, xb), when he is consuming the bundle (9, 10)? (Give a numerical answer.) • Imagine the price of nuts pn = 1, and pb = 2. What is his budget if he can afford the bundle (9, 10)? Can he afford the new bundle?

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