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Part 1
If Jose Maria's utility function is
U(x,
y)equals=xplus+Ax Superscript alphaxαy Superscript betayβplus+y,
what is his marginal utility of good y?
Part 2
Jose Maria's
marginal utility
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of good y
(MU Subscript yMUy)
is
MU Subscript yMUyequals=beta Ax Superscript alpha Baseline y Superscript left parenthesis beta minus 1 right parenthesis Baseline plus 1βAxαy(β−1)+1.
(Properly format your expression using the tools in the palette. Hover over tools to see keyboard shortcuts. E.g., a superscript can be created with the ^ character.)
Part 3
What is his
marginal rate of substitution
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between these two goods?
Part 4
Jose Maria's marginal rate of substitution (MRS) of good x for good y is
MRSequals=enter your response here.
(Properly format your expression using the tools in the palette.)