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Consider the following utility functions:

a. U(x,y)=xy

b. U(x,y)=x^2y^2

c. U(x,y)= lnx+lny

Show that each of these has a diminishing MRS but that they exhibit constant, increasing, and decreasing marginal utility, respectively. What do you conclude?

Business Economics, Economics

  • Category:- Business Economics
  • Reference No.:- M91387236

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