Answer to Question #228305 in Microeconomics for ktym

Question

For every two boxes of strawberries that she consumes, Millicent insists on having one pitcher of cream. She does not, however, insist on consuming the same amount every week. Her utility functions is U = min{s1, 2c1}min{s2, 2c2}, where s1 and s2 are the number of boxes of strawberries she consumes this week and next week and c1 and c2 are the number of pitchers of cream she consumes this week and next. Strawberries cost $2 a box and cream costs $1 a pitcher. She has a present value of $100 to spend on these goods in the next two weeks. The weekly interest rate is 1%. How many boxes of strawberries will she consume this week?

Answer 1

step by step explanation

for every 2 boxes equals 1 cream

one box costs 2$

one cream costs 1$

in every 2 boxes and 1 cream she spend 5$

in 2 weeks he spends 100$

so,

if 100$=10 days(2 weeks)

? = 5 days(1 week)

(100 times 5) divide by10

=50 dollars spend in 1 week

in that 5$ are spend at ago

if 50$ =5 days

? =2 days

answer

(50 times 2) divide by 5

20 boxes of strawberries