Terry’s utility function over leisure (Lgoods (YULYYLYutilities are MUYLMULY ) and other ) is (, ) = + . The associated marginal = 1 + and = . He purchases other goods at a price of $1, out of the income he earns from working. Show that, no matter what Terry’s wage rate, the optimal number of hours of leisure that he consumes is always the same. What is the number of hours he would like to have for leisure? (I want to know a detail solution in easy way.)
Terry’s utility function over leisure (Lgoods (YULYYLYutilities are MUYLMULY
) and other
) is (, ) = + . The associated marginal
= 1 + and = . He purchases
other goods at a price of $1, out of the income he
earns from working. Show that, no matter what Terry’s
wage rate, the optimal number of hours of leisure that he
consumes is always the same. What is the number of
hours he would like to have for leisure?
(I want to know a detail solution in easy way.)
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