Jeff, Alan, and Katie all work for the same employer at an hourly wage rate of wo-$24. All three of them have T=100 hours of weekly time endowment and non-labor income of IN=$0. Their preferences over consumption and leisure are as follows: Jeff: U (c, l) = cl² Alan: U(c, l) = min {c, 241} Katie: U (c, l) = c + 221 Based on the consumption-leisure model, solve for Jeff, Alan, and Katie's optimal consumption and leisure choices: (cf, lj), (cÃ‚ lÃ), and (ck, lk), respectively. For each worker, graphically illustrate their optimal consumption and leisure choices by drawing the indifference curve and budget constraint and labeling their respective optimal bundle (use separate graphs for each worker). What are the optimal working hours for each worker?

Jeff, Alan, and Katie all work for the same employer at an hourly wage rate of wo-$24. All three of them have T=100 hours of weekly time endowment and non-labor income of IN=$0. Their preferences over consumption and leisure are as follows: Jeff: U (c, l) = cl² Alan: U(c, l) = min {c, 241} Katie: U (c, l) = c + 221 Based on the consumption-leisure model, solve for Jeff, Alan, and Katie's optimal consumption and leisure choices: (cf, lj), (cÃ‚ lÃ), and (ck, lk), respectively. For each worker, graphically illustrate their optimal consumption and leisure choices by drawing the indifference curve and budget constraint and labeling their respective optimal bundle (use separate graphs for each worker). What are the optimal working hours for each worker?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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