Micro-consumer theoryy

Posted by SoniaKapoor on Jan 23, 2014; 9:01pm
URL: http://discussion-forum.276.s1.nabble.com/Micro-consumer-theoryy-tp7584570.html

Ollie has 40 dollars, which he decides to spend on x and y. Commodity x costs $13 per unit
and commodity y costs $11 per unit. He has the utility function U(x; y) = 6x2 + 4y2 and he can
purchase fractional units of x and y.
a) Ollie will choose only x.
b) Ollie will choose only y.
c) Ollie will chose some of each commodity, but more y than x.
d) Ollie will choose some of each commodity, but more x than y.
e) Ollie will choose equal amounts of the two commodities.