Re: DSE 2006 - Q.21, 22, 23

Posted by Amit Goyal on Jun 22, 2011; 9:05pm
URL: http://discussion-forum.276.s1.nabble.com/DSE-2006-Q-21-22-23-tp6503619p6506154.html

Forget about competitive equilibrium for the time being.
First answer this problem: A consumer with utility function u(x, y) = min{x, y} faces price of x = 1 and price of y = 0. Suppose he is a utility maximizing consumer and has income 100 to spend on the two goods. Find the set of all solutions to the utility maximization problem (subject to budget constraint and non-negativity constraints).