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Questions › UoH › UoH 2020 › Q91
1 mark, −0.33Microeconomics › Budget constraint and consumer equilibrium › Utility maximisation and the interior optimumEasyabout 1 min

UoH 2020 Question 91: Budget constraint and consumer equilibrium

A consumer's utility function is given by U(x,y)=xyU(x, y) = xyU(x,y)=xy, with a budgetary constraint 5x+10y=1005x + 10y = 1005x+10y=100. Find the value of xxx and yyy that maximizes this utility function.

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A consumer's utility function is given by U(x, y) = xy, with a budgetary constraint 5x + 10y = 100. Find the value of x and y that maximizes this utility function. (A) x = 5 and y = 5 (B) x = 10 and y = 5 (C) x = 5 and y = 10 (D) x = 1/10 and y = 1/5

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

What this question tests

This question is on Utility maximisation and the interior optimum, part of Budget constraint and consumer equilibrium in Microeconomics.

Choosing the best affordable bundle where an indifference curve is tangent to the budget line, including Cobb-Douglas demand.

TestStop has 20 past-paper questions on this subtopic.

Practise Budget constraint and consumer equilibriumMore on Utility maximisation and the interior optimum

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