Find minimum level of the price compatible with facts
Lee has the utility function U(x1,x2) = (x1+1)(x2+4) The price of x2 is $1. Lee spends all his income to buy 6 units of x2 and no x1. What is the minimum level of the price of x1 compatible with these facts? Explain your answer.
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What is the maximum amount the company should be willing to pay an outside supplier per unit for the part if the supplier commits to supplying all 30,000 units required each year?
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Lee has the utility function U(x1,x2) = (x1+1)(x2+4) The price of x2 is $1. Lee spends all his income to buy 6 units of x2 and no x1. What is the minimum level of the price of x1 compatible with these facts?
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