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HW Econ 1
HW Econ 1
Id
Based on the Utility Theory and the above table, answer the following FIVE questions:
Find out Marginal Utility of X with each quantity consumed (write the MU equation, below and
fill in column number 3, above).
Q=6 as the marginal uility=0 but after 6 uint the MU will be Negative
(iv) Graph the Total Utility and Marginal Utility curves, showing the equilibrium points.
U
140
120
100
80
60
40
20
0
1 2 3 4 5 6 7 8 9
MU
60
50
40
30
20
10
0
1 2 3 4 5 6 7 8
-10
-20
(v) Derive the demand curve from marginal utility, using the values of MUX as you found it in the
Table, above. Show two graphs (one for MUX and the second for the derived demand curve, as
explained in the class)
Demand schedule
P Q
2.73 3
2 4
P
3
3; 2.73
2.5
2 4; 2
1.5
0.5
0
3 4