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angela210793
first of all wht do u call preferences which utility function is U(x,y)=min{2x+y;x+2y}
angela see this pdf i feel it would help you
i know what they are called in albanian i just wanted to know the name in english actually :)
you should plot two lines then min of them in each interval is utility function. i make a problem with only one variable.
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@sheg where is your pdf from?
@angela210793 the various values of x and y are the preferences
the question that bothers me is how one measures utility, or, in other words how to derive the utility function?
does anyone know any practical ways of deriving utility functions? have anyone heard of such processes being performed in the real word? I haven't and therefore, utility function is more an abstract concept to me than a practical one.
What i wanted to ask about is....do u equal 2x+y=x+2y as u usually do when u have U(xy)=min{ax,by}
if you do this you will get x=y which doesn't make any sense in fact the function U(x,y) equals either 2x+y or x+2y depending on what is smaller, for example, if x=1 and y=2 2x+y=2+2=4 and x+2y=1+2*2=5 therefore the function will equal 4 (the smaller of the two). x and y are preferences: a person prefers 1 unit of x and 2 units of y and the utility function equals 4 in this case.