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Questions › JNU › JNU SIS 2016 › Q43
2 marks, −1Microeconomics › Budget constraint and consumer equilibrium › Demand under complements, substitutes and quasilinear utilityHardabout 2 min

JNU SIS 2016 Question 43: Budget constraint and consumer equilibrium

Consider the utility function u(x,y)=min⁡(2x+y,x+2y)u(x, y) = \min(2x + y, x + 2y)u(x,y)=min(2x+y,x+2y). Let px,pyp_x, p_ypx​,py​ denote prices of two goods. The utility maximizing choice is x=0x = 0x=0 if

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Consider the utility function u(x, y) = min (2x + y, x + 2y). Let pₓ, p_y denote prices of two goods. The utility maximizing choice is x = 0 if (A) pₓ > 2p_y (B) pₓ > p_y (C) pₓ < p_y (D) None of the above

Also written as: Consider the utility function u(x, y) = min (2x + y, x + 2y). Let p_x, p_y denote prices of two goods. The utility maximizing choice is x = 0 if

Budget constraint and consumer equilibrium has come up 99 times in 7 exams since 2004.

What this question tests

This question is on Demand under complements, substitutes and quasilinear utility, part of Budget constraint and consumer equilibrium in Microeconomics.

Deriving demand when preferences are L-shaped, linear or quasilinear, and what that implies for income and price responses.

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