Consider the utility function w/(x,xxz) = \x7 +./X2 (a) Calculate the MRS. Is the preference homothetic? Explain (b) Doe

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Consider The Utility Function W X Xxz X7 X2 A Calculate The Mrs Is The Preference Homothetic Explain B Doe 1 (26.41 KiB) Viewed 95 times

Consider the utility function w/(x,xxz) = \x7 +./X2 (a) Calculate the MRS. Is the preference homothetic? Explain (b) Does the utility function ug(x1,42) = 51n(/**+/xz)-2000 represent the same preference as us? If yes, show mathematically that given any two bundles A = (x®,.x®,) and B = (x,x), it A is preferred to Bunder u,, then A must also be preferred to Bunder un if no, find a pair of consumption bundies that contradicts the claim. In other words, find two consumption bundles A = (x,x) and B=(x,x") such that A is preferred to B under u,, but Bis preferred to A under ug. (You need to provide actual numbers for the two bundles) . 1 () Repeat(), but this time compare u, with the valley function ugfxrux)= vent vous (d) Repeat (b), but this time compare u, with the utility function (X16X= xy + x2