Assume that a person’s utility function is U(x,y)= x2y2 (yielding an MRS=y/x). The price of x is $2, and the price of y is $5. His income is $100. a) What is his optimal choice.
Hint*: find the Budget Contraint formula, then the Marginal rate of substitution, and then the tangency condition to help find the optimal choice.
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