recall that Casper's utility function is 3x + y, where x is his consumption of cocoa and y is his consumption of cheese.If the total cost of x units of cocoa is x², the price of cheese is $2, and Casper's income is $39, how many units of cocoa will he consume? A)5 B)0 C)2 D)3 E)6

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Quizplus · Accepted Answer

We need to maximize Casper's utility function subject to his budget constraint. His budget constraint is: x² + 2y = 39 We can rearrange it as: y = (39 - x²)/2 Substituting y in the utility function, we get: U(x) = 3x F1F1F1S1F1F1F10 (39 - x²)/2 To maximize U(x), we need to find the value of x that maximizes the above function. Differentiating U(x) with respect to x and setting it equal to zero, we get: 3 F1F1F1S1F1F1F10 (39 - 2x²)/2 = 0 Simplifying, we get: 39 - 2x² = 0 x² = 19.5 x = 3 Therefore, Casper will consume 3 units of cocoa.

Recall That Casper's Utility Function Is 3x + Y, Where