Quiz1 - IZ MI R U N I V E R S I T Y O F E C O N O M I C S...

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Unformatted text preview: IZ MI R U N I V E R S I T Y O F E C O N O M I C S Econ 201 - Microeconomics Name: Quiz 2 - 26 Nov 2008 Student No: Assist. Prof. Efe Postalc Answer the following 6 questions. You have 45 minutes. 1. Emilys utility function is U ( x,y ) = 3 min { x,y } + y . If we draw her indiffer- ence curves with x on the horizontal axis and y on the vertical axis, these indifference curves are (a) made up of two line segments that meet where x = 4y. One of these line segments is vertical and the other has slope -1. (b) L-shaped with kinks where x = 4y. (c) L-shaped with kinks where x = y. (d) made up of two line segments that meet where x = y. One of these line segments is horizontal and the other has slope -3. (e) V-shaped with kinks where x = 3y. 2. Harry Mazzola has the utility function U ( x 1 ,x 2 ) = min { x 1 + 2 x 2 , 2 x 1 + x 2 } . He has $40 to spend on corn chips and french fries. If the price of corn chips is $3 per unit and the price of french fries is $4, then Harry will (a) definitely spend all of his income on corn...
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This note was uploaded on 05/05/2010 for the course ECONMOICS ECON 203 taught by Professor Josephpetry during the Spring '10 term at University of Illinois, Urbana Champaign.

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