Microeconomics problem help!

IMBF

4 Jan 12, 05:04

Hi guys! Im a first semester student and I have a final exam tomorrow. There is this one problem I still dont know how to solve...

A Brazilian town regularly holds festivals, which is enjoyed by all citizens. The utility function of a citizen is u(d, p)=sqrt(d)+p, where d is the number of dancers in the festival and p is the money spent on private goods. The income of a person is 500.000 reals. The cost of inviting a dancer to the festival is 500 reals. There are 10.000 people in the town. If the town council wants to provide the efficient number of dancers for the festival, how many dancers are going to be invited? Explain.

SBS2601D

6 Jan 12, 11:20

Sub the budget constraint of a citizen through variable p into the utility function and then maximise the utility function wrt variable d and find d.

^Acid^ aka s|aO^eH~

6 Jan 12, 11:27

Originally posted by SBS2601D:

Sub the budget constraint of a citizen through variable p into the utility function and then maximise the utility function wrt variable d and find d.

U answered a day too late

SBS2601D

6 Jan 12, 11:30

Post-action review ma.