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Lisa Consumes Only Pizzas (P)and Burritos (B)

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Essay

Lisa consumes only pizzas (P)and burritos (B).Her utility function is U = P⁰.⁵ B⁰.⁵.The price of per pizza is $10 and the price per burrito is $5.In equilibrium,Lisa consumes four pizzas.Using Lisa's utility function,calculate how many burritos she consumes.


Definitions:

Activity

Engagements or actions undertaken by individuals, businesses, or economies, often implying economic transactions or movements.

Private Property

A legal designation for the ownership of property by non-governmental legal entities, affording the owner exclusive rights to the use, disfranchisement, and transfer of the property.

Enforce Contracts

The process of legally ensuring that the terms of a contract are carried out as agreed, often involving judicial or regulatory intervention.

External Benefits

Advantages or positive effects generated by an economic activity that benefit individuals or entities not directly involved in the activity.

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