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Anyone here take basic university economics?, income expansion pathway
Michael derives hsi utility from two goods - cake (C) and donuts (D. His utility is given by U = C*D, with MUc = D and MUd = C. He has himcome I = $120 and price of C, (Pc) = $1, and price of D (Pd) = $1 as well. What is Donalds income expansion path? What are utility maximizing C and D? Holding his himcome and Pd constant at their current values, what is Donald's demand curve for cake?
What playa knows this - its probably pretty simple, I took econ as a filler class |
Wow, I majored in economics the second time I was in college and I swear I don't recognize the word himcome. And I'm a little fuzzy on what the utility refers to as well...
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Where did you find that question? It doesn't really make sense that U would be C*D, but purely from mathematical point of view U will be max when C=D=60 if that helps you in any way...
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