Alex_Of_Darkness
New member
- Joined
- Nov 16, 2017
- Messages
- 29
Find consumption that maximizes agent utility U(x1,x2)=alnx1+(1-a)lnx2 (with a∈]0,1[)
Hi, it's my first post here and I'm kind of desperate right now because I have absolutely no clue how to resolve this problem.
The utility function of an economic agent is given by U(x1,x2)=alnx1+(1-a)lnx2 (with a∈]0,1[). If he consumes the quantity x1 of the good, he has only x2= (R-P1x1)/P2 left for the possibility of consumption of the second good. R is the agent's income, P1 and P2 are the prices of the two goods. R>1, P1>0 & P2>0 and they are fixed and known. Find the x1 and x2 consumptions that maximize the utility of the agent.
If anyone is able to help me, I would be the most grateful person in the entire universe.
Hi, it's my first post here and I'm kind of desperate right now because I have absolutely no clue how to resolve this problem.
The utility function of an economic agent is given by U(x1,x2)=alnx1+(1-a)lnx2 (with a∈]0,1[). If he consumes the quantity x1 of the good, he has only x2= (R-P1x1)/P2 left for the possibility of consumption of the second good. R is the agent's income, P1 and P2 are the prices of the two goods. R>1, P1>0 & P2>0 and they are fixed and known. Find the x1 and x2 consumptions that maximize the utility of the agent.
If anyone is able to help me, I would be the most grateful person in the entire universe.