00:01
So, while a standard form of a utility function, u would be equal to, let's say, x to the a, b to the b, where little a and b here are the constants that represent the utility derived from each good.
00:18
Given this, we're looking to derive the demand for apples based on an understanding of utility function.
00:24
We might consider a utility function such as u equals x to the fourth b, which seems to be what the function is going to be here without the undefined variable a.
00:43
So then the solutions would indicate two possible outcomes for the quantities of apples, x, and bananas, b, that maximize chandler's utility given his income m, the price of apples, follows p sub a and the price of bananas, p sub b.
00:57
So one solution is going to be x equals zero, and b is equal to m over p sub b, meaning all the income would be spent on bananas and then none on apples...