Homework Answers
No. It is not true.
For a necessary good, the income elasticity is positive. So, a consumer will buy more of the necessary goods as income increases.
For an inferior good, the income elasticity is negative. So, a consumer will buy less of an inferior good as income increases.
For a luxury good, the income elasticity is greater than 1. So, a consumer will buy more of a luxury good as income increases.
Add Answer to:
als e 7. Is it true that a consumer will necessarily buy more of a good...
3) (4pts. Consider a consumer who spends all his income on two goods, say 804 that...
3) (4pts. Consider a consumer who spends all his income on two goods, say 804 that good 1 is an inferior good at the current prices and income). If the price and also the income of the consumer doubles, how does his demand for good at all. Explain. all his income on two goods, say good 1 and good 2. Assume ces and income). If the price of both goods double w does his demand for good 1 change, if...
can you please explain this deeply? thank you Question 7 Consider a consumer with preferences over...
can you please explain this deeply? thank you
Question 7 Consider a consumer with preferences over two goods 1 and 2. Assume that the horizontal axis pertains to the amount of good 1 and the vertical axis pertains to the amount of good 2. Suppose that, given the consumption bundle r = 10 and y = 10, a consumer's MRS (marginal rate of substitution) is equal (in absolute value) to 4. The price of good 1 is $1, the price...
If a consumer is spending a small portion of his or her income on a good,...
If a consumer is spending a small portion of his or her income on a good, then the demand for the good is likely to be inelastic. True False A consumer is in equilibrium when the slope of his or her indifference curve is equal to his or her budget constraint. True False The below figure shows the various combinations of the goods X and Y that yield different levels of utility. Figure 7.3 In Figure 7.3, if the price...
Indicate whether the following statements are True or False e)If Tom's total utility from watching one...
Indicate whether the following statements are True or False e)If Tom's total utility from watching one more minute of television increases but the increase for each additional minute is smaller tha the previous minute,he has diminishing marginal utility f)As a person consumes more and more slices of pizza, the marginal utility of each extra slice diminishes g)A consumer will maximize utility when all income is spent and the marginal utility is equal for all goods h)When Kathryn spends her entire...
please solve exercise 8.21 es the consumer buy at the higher price of beer and her...
please solve exercise 8.21
es the consumer buy at the higher price of beer and her new different consumption bundle from O? llicks compensation? Explain h. Using red ink, draw the draw the new budget line and label the new optimal point, Point C. books and CDs does the consumer purchase at the new prices and her original which income? old new budget line in blue ink and label the new optimal consumption bundle, Point j. Draw this new budget...
2. (A random utility discrete choice model). Assume that each consumer is to buy a cellphone,...
2. (A random utility discrete choice model). Assume that each consumer is to buy a cellphone, either an iphone or an android phone (not both). Let U(iphone) be the utility for owning an iphone, and U(android) be the utility for owning an android phone. A consumer buys an iphone if U(iphone) > U(android), otherwise, he buys an android phone. Let y = U(iphone) - U(android) be the difference in utilities for consumer i, and y = Bo + Bilal +...Belik...
7) The picture below shows several indifference curves of a consumer and several budget lines: X2...
7) The picture below shows several indifference curves of a consumer and several budget lines: X2 1 2 3 4 5 6 7 8 9 10 11 12 Note that the lines passing through A, C, and E are parallel. Also the lines passing through B, D, and F are parallel. Move over at each bundle labeled with a letter, the budget line and indifference curve passing through that bundle are tangent. The consumption levels at each of the labeled...
24. Suppose that for Jason the marginal utility of $50-per-serving caviar is 100 and the marginal...
24. Suppose that for Jason the marginal utility of $50-per-serving caviar is 100 and the marginal utility of $1-per- serving popcorn is 10. For his snack, Jason should buy the caviar if he has the $50; otherwise the popcorn b. the caviar if he has the $50; otherwise nothing a. the popcorn, whether he has the $50 or not d. one serving each of the caviar and popcorn, if he has $51 five servings of popcorn for each serving of...
3. Consider a representative consumer who has preferences over an aggregate consumption good e and leisure....
3. Consider a representative consumer who has preferences over an aggregate consumption good e and leisure. Her preferences are described by the uility function: U(c,l) In(e) +In(l) The consumer has a time endowment of h hours which can be used to work at the market or enjoyed as leisure. The real wage rate is w per hour. The worker pays a proportional wage tax of rate t, so the worker's after-tax wage is (1 t). The consumer also has dividend...
Consumer's surplus: A consumer has the utility function U(x,y) =e^((ln(X)+Y)^1/3) where X is the good in...
Consumer's surplus: A consumer has the utility function U(x,y) =e^((ln(X)+Y)^1/3) where X is the good in concern and Y is the money that can be spent on all other goods. (So the price of Y is normalized to be 1). The income of this consumer is 100. (a) (10pts) Derive the demand function of x for this consumer. Make sure that at every price of x, the consumer always has enough income to buy the amount of x as indicated...
3) (4pts. Consider a consumer who spends all his income on two goods, say 804 that good 1 is an inferior good at the current prices and income). If the price and also the income of the consumer doubles, how does his demand for good at all. Explain. all his income on two goods, say good 1 and good 2. Assume ces and income). If the price of both goods double w does his demand for good 1 change, if...
can you please explain this deeply? thank you
Question 7 Consider a consumer with preferences over two goods 1 and 2. Assume that the horizontal axis pertains to the amount of good 1 and the vertical axis pertains to the amount of good 2. Suppose that, given the consumption bundle r = 10 and y = 10, a consumer's MRS (marginal rate of substitution) is equal (in absolute value) to 4. The price of good 1 is $1, the price...
please solve exercise 8.21
es the consumer buy at the higher price of beer and her new different consumption bundle from O? llicks compensation? Explain h. Using red ink, draw the draw the new budget line and label the new optimal point, Point C. books and CDs does the consumer purchase at the new prices and her original which income? old new budget line in blue ink and label the new optimal consumption bundle, Point j. Draw this new budget...
2. (A random utility discrete choice model). Assume that each consumer is to buy a cellphone, either an iphone or an android phone (not both). Let U(iphone) be the utility for owning an iphone, and U(android) be the utility for owning an android phone. A consumer buys an iphone if U(iphone) > U(android), otherwise, he buys an android phone. Let y = U(iphone) - U(android) be the difference in utilities for consumer i, and y = Bo + Bilal +...Belik...
7) The picture below shows several indifference curves of a consumer and several budget lines: X2 1 2 3 4 5 6 7 8 9 10 11 12 Note that the lines passing through A, C, and E are parallel. Also the lines passing through B, D, and F are parallel. Move over at each bundle labeled with a letter, the budget line and indifference curve passing through that bundle are tangent. The consumption levels at each of the labeled...
24. Suppose that for Jason the marginal utility of $50-per-serving caviar is 100 and the marginal utility of $1-per- serving popcorn is 10. For his snack, Jason should buy the caviar if he has the $50; otherwise the popcorn b. the caviar if he has the $50; otherwise nothing a. the popcorn, whether he has the $50 or not d. one serving each of the caviar and popcorn, if he has $51 five servings of popcorn for each serving of...
3. Consider a representative consumer who has preferences over an aggregate consumption good e and leisure. Her preferences are described by the uility function: U(c,l) In(e) +In(l) The consumer has a time endowment of h hours which can be used to work at the market or enjoyed as leisure. The real wage rate is w per hour. The worker pays a proportional wage tax of rate t, so the worker's after-tax wage is (1 t). The consumer also has dividend...
Most questions answered within 3 hours.
-
Which of the following best describes tidal volume? options:
1.The amount of oxygen in the air...
asked 2 minutes ago -
1. Smaller cost distortions occur when the traditional systems'
single indirect-cost rate and the activity-cost-driver rates:...
asked 10 minutes ago -
Using either a FMECA approach or some other appropriate RCA
tool, identify five risk treatment actions...
asked 10 minutes ago -
If for a test the P-value is between 0.0025 and 0.005, what
conclusion can you draw?...
asked 23 minutes ago -
Using Python. Write a function clean2(aList) that takes a list
of integers aList as argument, and...
asked 28 minutes ago -
Intrapreneurship is defined as the
development of an enterprise culture with an existing (Nandan,
2009). An...
asked 42 minutes ago -
QUESTION 1 Tamiflu is a drug used to treat influenza. A study
found that Tamiflu reduced...
asked 46 minutes ago -
Which of the following would be less likely to be used to
allocate factory overhead when...
asked 52 minutes ago -
Transverse pulses travel with a speed of 195 m/s along a taut
copper wire whose diameter...
asked 51 minutes ago -
Sampling for Engineers Homework question 11.51
Suppose that Y1;Y2;Y3;Y4 denote a random sample from a
Poisson(θ)...
asked 54 minutes ago -
Which of the following is cleaved by regulated intramembrane
proteolysis (RIP)? Select any/all answers that apply....
asked 54 minutes ago -
Random characters You decide to create a program characters.py
that fills a two-dimensional list with random...
asked 1 hour ago