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answerhappygod
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PLEASE TYPE YOUR WORK FOR A LIKE. Thank you.
PLEASE TYPE YOUR WORK FOR A LIKE. Thank you.
Question 7: 1. Consider a transformation of the utility function in Question 6 using u = ln(u). In other words, the new utility function u' = ln(u) = ln(xªy) = ln()+ ax ln(x) + bx In(y). What is MRSy of this new utility function? Is it the same as or different from MRSxy you found in Q6.3? Explain. 2. Will the MRS be still the same for each of the following transformation? Explain without directly solving for MRS. a). u' = u² b). u = 1/³ c). u' = 1987 xu - 507 d). u = e" 3. Explain why taking a monotonic transformation of a utility function does not change the marginal rate of substitution (MRS).
Question 7: 1. Consider a transformation of the utility function in Question 6 using u = ln(u). In other words, the new utility function u' = ln(u) = ln(xªy) = ln()+ ax ln(x) + bx In(y). What is MRSy of this new utility function? Is it the same as or different from MRSxy you found in Q6.3? Explain. 2. Will the MRS be still the same for each of the following transformation? Explain without directly solving for MRS. a). u' = u² b). u = 1/³ c). u' = 1987 xu - 507 d). u = e" 3. Explain why taking a monotonic transformation of a utility function does not change the marginal rate of substitution (MRS).