There are two commodities: z and y. Let the consumer's consumption set be Rị and his preference relation on his consumption set be represented by u(z, y) = VE + 3y. When his income is equal to 1 and...

Part 2 beginning with "now assume"

Extracted text: There are two commodities: z and y. Let the consumer's consumption set be Rị and his preference relation on his consumption set be represented by u(z, y) = VE + 3y. When his income is equal to 1 and the prices of good z, Pz = 1 and of good y, Py = 1, 1. Solve the utility maximization problem. 2. Does the solution calculated here obey the "equal bang for bnek' condition? Explain. Now assume that the preference relation on his consumption set be represented by u(z, y) = 3V7+y. When his income is equal to 1 and the prices of good z, Pz = 1 and of good y, Py = 1, 1. Solve the utility maximization problem. 2. Does the solution calculated here obey the "equal bang for buck' condition? Explain.