The utility maximization condition for the consumer is. Choose the correct one.MRSLC = 17-1MRSL,C = wMRSLC = Y/1MRSLC = 1/w This problem considers the decisions of a consumer whose preferences are given by u(C, 1) =C + y log 1,in which is the quantity of consumption and I is the quantity of leisure. The consumer faces twoconstraints. The time constraint is given by 1 + N = 1 with N³ as the time spent working (or thelabor supply). Assume that 0 < x < 1. The main advantage of working is the wages consumersreceive.Consumers take wages as given (outside of their control) and obtain wage income equal to w Nº.The budget constraint is C = wN+T-T, with as real dividend income and T as the reallump-sum taxes paid to government. Assume that an interior solution always exists in the optimalconsumption-leisure choice.

The economic principle of utility maximization involves individuals aiming to attain the utmost…

Answered: The utility maximization condition for…

The utility maximization condition for the consumer is. Choose the correct one. MRSLC = -1 MRSL,C = W MRSIC=Y/L OMRSLc = 1/w

ENGR.ECONOMIC ANALYSIS

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Chapter1: Making Economics Decisions

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Question

The utility maximization condition for the consumer is. Choose the correct one.
MRSLC = 17-1
MRSL,C = w
MRSLC = Y/1
MRSLC = 1/w

This problem considers the decisions of a consumer whose preferences are given by u(C, 1) =
C + y log 1,
in which is the quantity of consumption and I is the quantity of leisure. The consumer faces two
constraints. The time constraint is given by 1 + N = 1 with N³ as the time spent working (or the
labor supply). Assume that 0 < x < 1. The main advantage of working is the wages consumers
receive.
Consumers take wages as given (outside of their control) and obtain wage income equal to w Nº.
The budget constraint is C = wN+T-T, with as real dividend income and T as the real
lump-sum taxes paid to government. Assume that an interior solution always exists in the optimal
consumption-leisure choice.

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