Econ501aH1S07

# Econ501aH1S07 - The Ohio State University Department of...

This preview shows pages 1–2. Sign up to view the full content.

The Ohio State University Department of Economics Econ 501.02—Prof. James Peck Homework #1 (due Wednesday, April 11) 1. Suppose we have the utility function, U = x 2 y 3 . (a) Find the function for the marginal rate of substitution. (b) Show that this utility function satis f es the f rst 3 axioms of consumer preference. (Hint: For example, the completeness axiom is satis f ed if for any two bundles A and B, either bundle A gives more utility than B when evaluated according to the function U, or B gives more utility than A, or the utility numbers of A and B are the same.) 2. Suppose we have the utility function, U =2 xy + x + y. (a) Find the function for the marginal rate of substitution. (b) If prices are p x =\$2 and p y =\$4 , and if income is M = \$17 , f nd the utility maximizing consumption bundle. 3. Suppose we have the utility function, U = x +3 y. (a) Find the function for the marginal rate of substitution. (b) If prices are p x =\$2 and p y =\$4 , and if income is M = \$200

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
This is the end of the preview. Sign up to access the rest of the document.

## This note was uploaded on 07/17/2008 for the course ECON 501.02 taught by Professor Yang during the Spring '08 term at Ohio State.

### Page1 / 2

Econ501aH1S07 - The Ohio State University Department of...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document
Ask a homework question - tutors are online