Suppose that Bella's utility function from bananas (B) and chocolate (C) is
. Her budget is $15, and the price of chocolate is $3.
a. Derive Bella's demand for bananas.
b. Suppose that Bella's budget increases to $20. Derive her new demand curve for bananas. Are bananas a normal or inferior good for Bella? Explain.

Question

Suppose that Bella's utility function from bananas (B) and chocolate (C) is  
. Her budget is $15, and the price of chocolate is $3. 
a. Derive Bella's demand for bananas.
b. Suppose that Bella's budget increases to $20. Derive her new demand curve for bananas. Are bananas a normal or inferior good for Bella? Explain.

Quizplus · Accepted Answer

The Answer of Suppose that Bella's utility function from bananas (B) and chocolate (C) is  
. Her budget is $15, and the price of chocolate is $3. 
a. Derive Bella's demand for bananas.
b. Suppose that Bella's budget increases to $20. Derive her new demand curve for bananas. Are bananas a normal or inferior good for Bella? Explain.

Suppose That Bella's Utility Function from Bananas (B) and Chocolate