Re: consumer surplus- please help!

Posted by Do bats eat cats? on Jun 27, 2013; 7:59am
URL: http://discussion-forum.276.s1.nabble.com/consumer-surplus-please-help-tp7583033p7583035.html

I'm not sure how consumer surplus is related to this question.

I simply maximised his utility subject to his constraint, and then calculated his utility for those values of x and y.

Mathematically Max U = 100x - x^2/2 + y
               Subject to  : 50x + y = 4000

Solving this gives x=50 and y=1500
and U(50,1500)= 100(50) - (50)^2/2 + 1500 = 5250, which should be the answer you're looking for.