A consumer's utility function is given by:
U(x,y)= 10xy
Currently,the prices of goods x and y are $3 and $5,respectively,and the consumer's income is $150.
a.Find the MRS for this consumer for any given bundle (x,y).
b.Find the optimal consumption bundle for this consumer.
c.Suppose the price of good x doubles.How much income is required so that the consumer is able to purchase the original consumption bundle (if you were unable to solve d. ,then take a guess at what the optimal bundle is before solving this)
d.Now that the price of good x has doubled,how much income is needed for the consumer to reach the original level of utility? Is this more or less that what you found in e.?

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The Answer of A consumer's utility function is given by:
U(x,y)= 10xy
Currently,the prices of goods x and y are $3 and $5,respectively,and the consumer's income is $150.
a.Find the MRS for this consumer for any given bundle (x,y).
b.Find the optimal consumption bundle for this consumer.
c.Suppose the price of good x doubles.How much income is required so that the consumer is able to purchase the original consumption bundle (if you were unable to solve d. ,then take a guess at what the optimal bundle is before solving this)
d.Now that the price of good x has doubled,how much income is needed for the consumer to reach the original level of utility? Is this more or less that what you found in e.?

A Consumer's Utility Function Is Given By