Minnie gets 4 tapes for her birthday, but they are currently useless to her because she doesn't have a tape recorder and she cannot return them for a refund. Her utility function is U(x, y, z) = x + f(y)z⁵, where z is the number of tapes she has, y is the number of tape recorders she has, and x is the money she has to spend on other stuff. Let f(y) = 0 if y

Question

Minnie gets 4 tapes for her birthday, but they are currently useless to her because she doesn't have a tape recorder and she cannot return them for a refund. Her utility function is U(x, y, z) = x + f(y)z⁵, where z is the number of tapes she has, y is the number of tape recorders she has, and x is the money she has to spend on other stuff. Let f(y) = 0 if y < 1 and f(y) = 7 otherwise. The price of tapes is $7.99. What is her reservation price for a tape recorder?

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The Answer of Minnie gets 4 tapes for her birthday, but they are currently useless to her because she doesn't have a tape recorder and she cannot return them for a refund. Her utility function is U(x, y, z) = x + f(y)z⁵, where z is the number of tapes she has, y is the number of tape recorders she has, and x is the money she has to spend on other stuff. Let f(y) = 0 if y < 1 and f(y) = 7 otherwise. The price of tapes is $7.99. What is her reservation price for a tape recorder?

Minnie Gets 4 Tapes for Her Birthday, but They Are