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In Siddharthas problem, calculate marginal utility for income and for leisure. Now

Chapter 6, Problem 6

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QUESTION:

In Siddhartha's problem, calculate marginal utility for income and for leisure. Now, start off at the choice with 50 hours of leisure and zero income, and a wage of $8 per hour, and explain, in terms of marginal utility how Siddhartha could reason his way to the optimal choice, using marginal thinking only.

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QUESTION:

In Siddhartha's problem, calculate marginal utility for income and for leisure. Now, start off at the choice with 50 hours of leisure and zero income, and a wage of $8 per hour, and explain, in terms of marginal utility how Siddhartha could reason his way to the optimal choice, using marginal thinking only.

ANSWER:

Step 1 of 2

Given data:

Siddhartha has a total of 50 hours per week to devote to Leisure, and the table is given as,

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