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Collin Richard
on Dec 01, 2024

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Clara's utility function is U(X, Y) =(X + 2) (Y + 1) .If Clara's marginal rate of substitution is -6 and she is consuming 8 units of good X, how many units of good Y is she consuming?

A) 59
B) 6
C) 60
D) 14
E) 13

Utility Function

A mathematical expression that represents how different combinations of goods or services create levels of happiness or satisfaction for an individual or entity.

Marginal Rate of Substitution

The rate at which a consumer is able to sacrifice a certain amount of one product for another while keeping their level of satisfaction unchanged.

Good X

A term used to represent an unspecified product or commodity in economic models and analyses.

  • Comprehend and compute the marginal rate of substitution (MRS), along with its influence on choices related to consumption.
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Taylor BennettDec 05, 2024
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