Question

An individual's utility (U) depends on their income (I). Their utility function is U = √I. Calculate the individual's level of utility when their income is I = 44. Round the result to the nearest tenth.

Answer 1

The individual's utility when their income is I = 44, using the utility function U = √I, is approximately 6.6 utils after rounding to the nearest tenth.

Step-by-step explanation:

To calculate an individual's level of utility when their income is I = 44 using the utility function U = √I, we substitute the given income into the function:

U = √I = √44 ≈ 6.633 (to three decimal places).

Now, rounding this result to the nearest tenth gives us a utility level of 6.6 utils.