A. Methods of finding characteristics roots of the quadratic equations. B

erurnSopSoypegx

erurnSopSoypegx

Answered question

2021-11-20

A. Methods of finding characteristics roots of the quadratic equations.
B. Maximize the utility function:
U=Y1+Y2
Subject to I=P1Y1+P2Y2
Also find out demand functions

Answer & Explanation

SaurbHurbkj

SaurbHurbkj

Beginner2021-11-21Added 16 answers

a) Let ax2+bx+c=0 be a quadratic equation. 
Method of finding the characteristic roots of this equation is: 
x=b±b24ac2a

Jeffrey Parrish

Jeffrey Parrish

Beginner2021-11-22Added 15 answers

Part (b): Utility function, U=Y1+Y2 (1) 
Subject to budget constraints, I=P1Y1+P2Y2 (2) 
Maximize condititon, 1P1UY1=1P2UY2 
1P1=1P2P1=P2=P (say.) 
I=P1(Y1+Y2)I=PU 
 Maximum Utility is: U=IP 
I=PY1+P(UY2) 
I=PU 
There is no demand function available for goods Y1 or Y2

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