1、
(1) x and y are perfect substitutes.
The consumer will always consume the good that has the relatively cheaper price, or any quantities of x and y when the price of x*2 equals the price of y.
(2) Originally,the consumer consumes 200/4=50 units of x,the utility u=2*50=100.
If the consumer has the incentive to enter the club , it means that the consumer will better off from the orig ...
1、
(1) x and y are perfect substitutes.
The consumer will always consume the good that has the relatively cheaper price, or any quantities of x and y when the price of x*2 equals the price of y.
(2) Originally,the consumer consumes 200/4=50 units of x,the utility u=2*50=100.
If the consumer has the incentive to enter the club , it means that the consumer will better off from the original consumption of x because of the price discount but paying for the right of discount.
Let t represents the payment for the right of discount,and p denotes the price of y before discount.Then, we get the amount of y that the consumer will consume after discount
y'=(200-t)/(p-1)
so as that p>2 and p-1<2.
Then , the utility u'=2*0+y'=(200-t)/(p-1).
From u'>u,we can conclude
(200-t)/(p-1)>100
t<300-100p (2<p<3)
So,we get
0<t<100.
That is to say, the consumer will pay no more than 100 yuan to enter the club .
2.
(1)
When p'(x,y)=(2,1) and m remains unchanged ,
the consumer will consume only y',and y'=600; the utility u'=600.
(2)Considering in order to obtain the equal utility 600 in the situation before ---- p(x,y) =(0.5,1)----the consumer would have owned income m=300.
So it is equivalent that the income decreases by 300 yuan.