Need help with this practice problem
Need help with this practice problem 2. (20 points) Suppose a consumer has $250 to spend...
4. Suppose a consumer has a budget of S500 to spend on goods X and Z that have prices p, =5 and pz =10. a. Write the equation for the budget constraint. b. Draw the budget line, placing good X on the horizontal axis and Z on the vertical axis. c. What is the slope of the budget constraint line?
2. Suppose that a consumer has income of $12 to spend on and r2. Also suppose that the price of 띠 is $2 per unit and the price of x2 is $1 per unit. You will be asked to draw the three budget line in one diagram. Please label each (as (a), (b) and (c) carefully (a) Draw the consumer's budget line on a diagram where a is on the horizontal axis and r2 is on the vertical axis. the...
2. (24 points) Suppose a consumer has preferences represented by the utility function U(X,Y)- X2Y Suppose Py, and the consumer has $300 to spend. Draw the Price-Consumption Curve for this consumer for income values Px-1, Px 2, and Px- 5. Your graph should accurately draw the budget constraints for each income level and specifically label the bundles that the consumer chooses for each income level. Also, for each bundle that the consumer chooses, draw the indifference curve that goes through...
1. (24 total points) Suppose a consumer’s utility function is given by U(X,Y) = X1/2*Y1/2. Also, the consumer has $72 to spend, and the price of Good X, PX = $4. Let Good Y be a composite good whose price is PY = $1. So on the Y-axis, we are graphing the amount of money that the consumer has available to spend on all other goods for any given value of X. a) (2 points) How much X and Y...
2) (18 points) For each of the following situations, draw the consumer's budget constraint and indicate the consumer's optimal bundle on the budget constraint. Make sure your graph is accurate and clearly labeled. a) U(X,Y)-X14Y34. The consumer has $24 to spend and the prices of the goods are Px S2 and Py S3. Note that the MUx-(1/4)X-3*Y34 and the MUy (3/4)X14Y-14. b) U(X,Y)-MIN(5X,Y). The consumer has S24 to spend and the prices of the goods are Px S3 and Py...
2) (18 points) For each of the following situations, draw the consumer's budget constraint and indicate the consumer's optimal bundle on the budget constraint. Make sure your graph is accurate and clearly labeled. a) U(X,Y)-X1"Y34. The consumer has S24 to spend and the prices of the goods are Px - S2 and Py S3. Note that the MUx-(1/4)X-3*Y34 and the MUy (3/4)X14Y-14. b) U(X,Y) MIN(5X,Y). The consumer has S2 4 to spend and the prices of the goods are Px...
Consider a consumer in a two commodity world whose indifference map is such that the slope of the indifference curves is everywhere equal to -(Y?X), where Y is the quantity of good Y measured along the vertical axis, and X is the quantity of good X measured along the horizontal axis. a. what is the value of the optimum Marginal Rate of Substitution for this consumer, given that the price of X is $1, the price of Y is $3...
. A family in Ethiopia has $100 to spend on food and all other goods for the entire year of 2018. The price of food is $2.00 per kilogram (let’s assume that all food is the same). The price of all other goods is $1.00 per unit. Write the equation for the household’s budget constraint for the year, with income on the left-hand side of the equation. Fill in the following chart so that the quantity purchased on each horizontal...
3. (10 total points) Suppose that Lynn enjoys sugar in her coffee. She has very particular preferences, and she must have exactly four spoonfuls of sugar for each cup of coffee. Let C be the number of cups of coffee, and S be the number of spoonfuls of sugar. Also, let Pc be the price of a cup of coffee. Suppose Lynn has $24 to spend on Coffee and Sugar. Also, the price of Sugar is $.30 per spoonful. Graph...
4. Suppose that a consumer faces the choice of how many left shoes to buy and how many right shoes to buy if the price of a shoe is $20 and the consumer has $200 to spend on shoes. (20 points in total) a. Write down the consumer's budget constraint, assuming that we will measure left shoe consumption on the X axis and right shoe consumption on the Y axis. (5 points) b. Sketch a graph of the budget constraint....