| Question |
Robinson Crusoe obtains utility from the quantity of fish he consumes in one day (F), the quantity of coconuts he consumes that day (C), and the hours of leisure time he has during the day (H) according to the utility function: Utility = F1/4C1/4H1/2 Robinson’s production of fish is given by F = ?LF (Where LF is the hours he spends fishing), and his production of coconuts is determine by C = ?LC (Where LC is the time he spends picking coconuts). Assuming that Robinson decides to work an eight hour day (that is, H = 16), graph his production possibility curve for fish and coconuts. Show his optimal choices of those goods. |
