University:
Elon University
Course:
ECO 1000 | Economics
Academic year:

2024
Views:

460

Pages:

2
Author:

Masadepan C.

Exploration of Characteristics of Demand Curve Y through Derivative MUy Draw the derived Demand y Curve (derivative of MUy curve) Px 10 10 10 Py 8 12 5 M 80 80 80 x 3,6 3,7 3,5 MU 15 14,8 14,5 MUy 3, 65, 59Y Py 12 8 5 Dy 3, 65, 59Y y 5,5 3,6 9 MUx 18,5 16 29 MUy 14,8 15 14,5 Umax 108,6 98,4 157,5 Explanation: • The downward curve of demand Y explains that the marginal utility gained from consuming good Y is decreasing over time, so the MUy curve is negative. • The demand curve for good Y is linear • If the price of good Y decreases, then the quantity of good Y increases, but the marginal satisfaction will decrease. So the law of demand applies to As the curve above shows, at a price of Y (Py) of 12, with the number of Y of 3.6 and marginal utility (MUy) of 15. However, if Py drops to 5 with the number of X rising to 9, but marginal utility drops to 14.5.