Re: Indifference curves for utility functions of form min(ax+by, cx+dy)

Posted by s on Jun 07, 2012; 1:08pm
URL: http://discussion-forum.276.s1.nabble.com/Indifference-curves-for-utility-functions-of-form-min-ax-by-cx-dy-tp7577527p7577548.html

hi sid for these utility functions if u have read about perfect complements u'l know that consumer will consume x and y at a fixed proportion and from ax+by and cx+dy the proportion is found as ax+by=cx+dy or x=(d-b)y/(a-c) now put this in the budget constraint say M=pxX + pyY and solve for optimum values of x and y. to draw the ICs and for better understanding refer Hal varian Intermediate Microeconomics workbook