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Assume that an individual's utility level(U) is a function of two goods: real income (Y) and leisure time (L) and is given by the function: U = 3YL1/3 . The budget constraint is given by V + w(T-L) = pY, where T=time available for work, w = wage rate, and p=the price index for real income and V=non-labor income. If V = 0, w = 1, T = 12, and p = 2, what is the utility maximizing choice of leisure hours?

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Assume that an individual's utility level(U) is a function of two goods: real income (Y) and leisure time (L) and is given by the function: U = 3YL<sup>1/3</sup> . The budget constraint is given by V + w(T-L) = pY, where T=time available for work, w = wage rate, and p=the price index for real income and V=non-labor income. If V = 0, w = 1, T = 12, and p = 2, what is the utility maximizing choice of leisure hours?





 
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