Re: Discussion Problem_(14)

Posted by Devika on May 25, 2013; 11:17am
URL: http://discussion-forum.276.s1.nabble.com/Discussion-Problem-14-tp7581214p7581222.html

I'm not quite sure of my approach, but here's how I did it.

At 15,10 the minimum utility is 40. Draw the graph. Optimal point occurs at the kink, i.e 2x=y.
So x=10 and y=20.

x*= m/p1+2p2

m= 150+ 10p2. Substitute the relevant values to get p2=5.

Hence the income is 200.