MRS=y/2x

price of x is $1

price of y is $3

income is $90

how much of each good should be consumed in order to maximize utility

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- Feb 11th 2010, 10:10 AMleinadwerdnamrs
MRS=y/2x

price of x is $1

price of y is $3

income is $90

how much of each good should be consumed in order to maximize utility - Feb 11th 2010, 02:48 PMRobb
Utility is maximised when

so Substituting this into the B.C which is

,

So Y can be calculated using and substituting into the B.C, or solving MRS equal to the price ratio for X. - Feb 13th 2010, 02:59 AMITStuff
great respons on the issue. there are more math problmes that require variable results!