HOMEWORK > ECON 425: Economics of Public Expenditures Homework Assignment 5 SOLUTIONS


Pennsylvania State University ECON 425 Problem 1: Labor-Leisure Choice. Kim has utility over consumption c and leisure l   represented by   U(c, l) = c1/3l2/3   Kim has 2,000 hours to spend on either labor or leisure. Her hourly wage is w = $7.50.   a) Draw Kim’s budget constraint.   b) What is Kim’s optimal level of consumption? Leisure ...[Show More]

Preview 1 out of 4 pages
Purchase this document to unlock the blurred part and the rest of the document

Unlock Now

Reviews( 0 )