Suppose Your Utility Function Is Given By$u \left( x _ { 1 } , x _ { 2 } \right) = \min \left\{ 3 x _ { 1 } , 5 x _ { 2 } \right\}$

Question

Examlex · Accepted Answer

The Answer is We know that you will consume where

3 x _ { 1 } = 5 x _ { 2 }

--- the ray from the origin on which the corners of all your indifference curves lie.You also have to satisfy your budget constraint

p _ { 1 } x _ { 1 } + p _ { 2 } x _ { 2 } = I

Solving these two equations,we get

x _ { 2 } = \frac { 3 I } { 5 p _ { 1 } + 3 p _ { 2 } }

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Suppose Your Utility Function Is Given By $u \left( x _ { 1 } , x _ { 2 } \right) = \min \left\{ 3 x _ { 1 } , 5 x _ { 2 } \right\}$