Homework Answers
This is a downward shift in the budget constraint. This can happen when only income decreases. In case prices of the two goods decrease by same proportion the budget line will shift out. In income is doubled and the prices are also doubled, the budget line will not shift/change.
Hence 1st option is correct
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On the budget line/indifference curve diagram (dick on it to make it bigger), if LQ and...
On the budget constraint and indifference curve diagram (click on it to make it bigger), if...
On the budget constraint and indifference curve diagram (click on it to make it bigger), if DK is the original budget line and DF is the new budget line, then which of the following must have happened to cause the move from DK to DF? The price of hot dogs must have risen. The price of Cokes must have fallen. None of the other answers is correct. The price of Cokes must have risen. The price of hot dogs must...
Draw a budget line /indifference curve diagram for two goods: water and electricity. Show the income...
Draw a budget line /indifference curve diagram for two goods: water and electricity. Show the income and substitution effects of the increase in the price of electricity. Assume that electricity is a normal good. 3 4 8 5 6 7
1) A) Use a budget line and Indifference curve to show an initial optimal consumption bundle...
1) A) Use a budget line and Indifference curve to show an initial optimal consumption bundle of onions and peppers. Assume onions are normal goods and peppers are inferior goods. Next suppose the price of peppers increases. Graphically Illustrate and explain the income and substitution effects. B) Using the two prices and two quantities of peppers from the previous part of this problem, construct a demand curve. Explain where your numbers are coming from. Also show the income and substitution...
2) If the price of automobiles were to increase substantially, the demand curve for gasoline would most likely A) shift...
2) If the price of automobiles were to increase substantially, the demand curve for gasoline would most likely A) shift leftward. B) shift rightward. C) become flatter. D) become steeper. 3) If the price of automobiles were to decrease substantially, the demand curve for automobiles would most likely A) shift rightward. B) shift leftward. C) remain unchanged. D) become steeper. 4) Suppose a market were currently at equilibrium. A rightward shift of the demand curve would cause A) an increase...
Ons of approach rent the Furthermore, the Fire 7:4 rate indeference curve, budget line and relative...
Ons of approach rent the Furthermore, the Fire 7:4 rate indeference curve, budget line and relative determine the utility maximization th possible indifference curve rifle th mer preference panely to th e at contr a o m en het Total Utility Maximization - MOL the -MRS e specific Bobby he game below The above equation is the condition of Total tility M unitions the point of between indifference curve and the budget line as the best possible combination good consumption...
Jane commutes to work. She can either use public transport or her own car. Her indifference curve...
Jane commutes to work. She can either use public transport or her own car. Her indifference curves obey the four properties of indifference curves for ordinary goods 1. Draw Jane's budget line (BL,) with car travel on the vertical axis and public transport on the horizontal axis 2. Suppose that Jane consumes some of both goods. Explain how her optimal consumption bundle can be obtained. Then, draw an indifference curve that helps you illustrate that optimal consumption bundle represented by...
MICROECONOMICS Please help me fill these out: QUESTION 4 A budget line 1. will tangent to...
MICROECONOMICS
Please help me fill these out:
QUESTION 4 A budget line 1. will tangent to indifference curve at the optimal choice of good. 2. rotates when the price of goods change. 3. has a slope equal to a relative price. 4.rotates or shifts when the consumer's budget changes. 5. shows the limits to what can be consumed. QUESTION 2 If the price of a good starts out above the equilibrium price, then A. consumers will compete to bid the...
Complete the following questions by selecting a SINGLE letter for each: i) Which of the following...
Complete the following questions by selecting a SINGLE letter for each: i) Which of the following is most likely to not be an inferior good? a. concert tickets b. Ramen noodle dinners c. none of the above (all of the above are inferior goods) d. used music CD's e. trips to the laundromat ii) If the government imposes a ceiling price on apartment rents, we would expect to observe which of the following? a. an increase in the number of...
HOMEWORK SET 4A MARKETS IN ACTION 1 Question 1 refers to the following diagram, which shows...
HOMEWORK SET 4A MARKETS IN ACTION 1 Question 1 refers to the following diagram, which shows the market for computers. 3 Price par computer (thousands oldaten ar 0 10 40 20 30 Quantity of computera Pundydis per wohl 1. Which of the following changes could cause the computer market to change as shown above? . Lower costs for computer chips and motherboards. b. The failure of several computer manufacturers. c. Higher prices for computer software. d. More features and greater...
2a In moving from one point to another point on an income-consumption curve, which of the...
2a In moving from one point to another point on an income-consumption curve, which of the following is false? A The prices of both goods remain constant. B The slope of the budget line remains constant. C Utility changes. D Income remains constant. E Income changes. 2B Regarding the U.S. economy, an economist has made the following two statements: A: “Reducing the number of months during which unemployed workers receive unemployment benefit payments will decrease the unemployment rate.” ...
On the budget constraint and indifference curve diagram (click on it to make it bigger), if DK is the original budget line and DF is the new budget line, then which of the following must have happened to cause the move from DK to DF? The price of hot dogs must have risen. The price of Cokes must have fallen. None of the other answers is correct. The price of Cokes must have risen. The price of hot dogs must...
Draw a budget line /indifference curve diagram for two goods: water and electricity. Show the income and substitution effects of the increase in the price of electricity. Assume that electricity is a normal good. 3 4 8 5 6 7
1) A) Use a budget line and Indifference curve to show an initial optimal consumption bundle of onions and peppers. Assume onions are normal goods and peppers are inferior goods. Next suppose the price of peppers increases. Graphically Illustrate and explain the income and substitution effects. B) Using the two prices and two quantities of peppers from the previous part of this problem, construct a demand curve. Explain where your numbers are coming from. Also show the income and substitution...
Ons of approach rent the Furthermore, the Fire 7:4 rate indeference curve, budget line and relative determine the utility maximization th possible indifference curve rifle th mer preference panely to th e at contr a o m en het Total Utility Maximization - MOL the -MRS e specific Bobby he game below The above equation is the condition of Total tility M unitions the point of between indifference curve and the budget line as the best possible combination good consumption...
Jane commutes to work. She can either use public transport or her own car. Her indifference curves obey the four properties of indifference curves for ordinary goods 1. Draw Jane's budget line (BL,) with car travel on the vertical axis and public transport on the horizontal axis 2. Suppose that Jane consumes some of both goods. Explain how her optimal consumption bundle can be obtained. Then, draw an indifference curve that helps you illustrate that optimal consumption bundle represented by...
MICROECONOMICS
Please help me fill these out:
QUESTION 4 A budget line 1. will tangent to indifference curve at the optimal choice of good. 2. rotates when the price of goods change. 3. has a slope equal to a relative price. 4.rotates or shifts when the consumer's budget changes. 5. shows the limits to what can be consumed. QUESTION 2 If the price of a good starts out above the equilibrium price, then A. consumers will compete to bid the...
HOMEWORK SET 4A MARKETS IN ACTION 1 Question 1 refers to the following diagram, which shows the market for computers. 3 Price par computer (thousands oldaten ar 0 10 40 20 30 Quantity of computera Pundydis per wohl 1. Which of the following changes could cause the computer market to change as shown above? . Lower costs for computer chips and motherboards. b. The failure of several computer manufacturers. c. Higher prices for computer software. d. More features and greater...
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