A consumer's utility for bundle x and y is given by the Stone-Geary Utility Function. The subsistence consumption levels

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A Consumer S Utility For Bundle X And Y Is Given By The Stone Geary Utility Function The Subsistence Consumption Levels 1 (81.14 KiB) Viewed 11 times

A consumer's utility for bundle x and y is given by the Stone-Geary Utility Function. The subsistence consumption levels for x is 20 units, while for y it is 50 units. ● ● ● Define the consumer's utility function given share parameters α = 0.4 and B = 0.6 for bundle x and y, respectively. If the price of x and y are p₁ = 2 and P2 1, respectively, and the budget of the consumer is b = 200, find the optimum quantity x* and y* as well as the utility u* at these levels. Plot the consumer's indifference curve at u* and their budget line in a single space. Plot bundle y at the vertical axis and bundle x at the horizontal axis.