This preview has intentionally blurred sections. Sign up to view the full version.
View Full Document
Unformatted text preview: (c) Use a graph to show the effect of the price decrease. T U R N O V E R > > 2. A romantic individual wants to increase the utility of their significant other by purchasing Wine(W) and Roses ( R) . The utility function to be maximized is U= W 0.4 R 0.6 However for romantic reasons the sum of the roses ( R ) plus four times the bottles of wine (W ) must be equal to 20. Assume that wine and roses are continuous variables and can be purchased in any fraction of quantity Solve the problem for the optimal allocation of Wine (W) and Roses ( R). Show your work....
View
Full
Document
This note was uploaded on 10/25/2010 for the course ARE 100A taught by Professor Constantine during the Winter '08 term at UC Davis.
 Winter '08
 CONSTANTINE

Click to edit the document details