Refer to Figure 21-19. Assume that the consumer depicted in the figure has an income of $20. The price of Skittles is $2 and the price of M&M's is $4. The consumer’s optimal choice is point (Hint: Solve using the budget constraint formula)
- A. A
- B. B
- C. C
- D. D
Homework Answers
Answer - Option A
Point A
The optimal choice of consumption will be point A. This is because at this point (2*4+4*3) makes up $ 20 which is exact as per the budget constriant of $ 20 which is not being met at point B.
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Refer to Figure 21-19. Assume that the consumer depicted in the
figure has an income of...
Figure 21-1 The downwardsloping line on the figure represents a consumer’s budget constraint. Refer to Figure...
Figure 21-1
The downwardsloping line on the
figure represents a consumer’s budget constraint.
Refer to Figure 21-1. If the
consumer’s income is $140, then what is the price of a CD?
$3
$5
$7
$9
Refer to Figure 21-1. A
consumer who chooses to spend all of her income could be at which
point(s) on the figure?
A only
E only
B, C, or D only
A, B, C, or D only
Refer to Figure 21-20. Assume that the consumer has an income of $40, the price of...
Refer to Figure 21-20. Assume that the consumer has an income of $40, the price of a bag of marshmallows is $2, and the price of a bag of chocolate chips is $2. The optimizing consumer will choose to purchase which bundle of marshmallows and chocolate chips? a. A b. B. C. C. d. D. 14. Figure 21-18 Refer to Figure 21-18. It would be possible for the consumer to reach I; if a. the price of y decreases. b....
Please explain. Q7: The following figure shows the indifference curves and budget constraint of a consumer....
Please explain.
Q7: The following figure shows the indifference curves and budget constraint of a consumer. De- termine the commodity bundle that will maximize the consumer's satisfaction given his budget. Why is the bundle the optimal choice? Good 1 Budget Constraint 0 1 2 3 4 5 6 7 8 9 10 Good 2
l. A consumer has €100 of income to allocate between chocolate and soda. Chocolate costs per...
l. A consumer has €100 of income to allocate between chocolate and soda. Chocolate costs per unit. (a) Suppose when soda costs 4 per unit, the consumer chooses 20 sodas. Draw the budget constraint and indifference curve to represent this budget and choice. (You can assume that the indifferences curves are regular, ie convex to the origin.) Now the company introduces a deal whereby the price falls to є3.00 if the consumer buys more than 20 sodas. So if the...
21. A positive income elasticity of demand coefficient indicates that a. a product is an...
21. A positive income elasticity of demand coefficient indicates that a. a product is an inferior good b. two products are substitute goods c. two products are complementary goods d. a product is a normal good 22. All the combinations of two products that will yield the same total utility to a consumer are reflected in a. the budget line b. the marginal rate of substitution c. an indifference curve d. the...
1.Use the table below to answer the following question. Assume that the price of product A...
1.Use the table below to answer the following question. Assume that the price of product A is $4.47 while the price for product B is $5.79. The buyer has a budget of $50. Q MUA MUB 1 22 25 2 21 24 3 20 23 4 19 22 5 18 21 6 17 20 7 16 19 8 15 18 9 14 17 10 13 16 Given the marginal utilities The optimal bundle is ____. A. 6 of product A...
Figure 9-11 Price Domestic Supply World Price Domestic Demand Quantity Refer to Figure 9.11. Consumer surplus in...
Figure 9-11 Price Domestic Supply World Price Domestic Demand Quantity Refer to Figure 9.11. Consumer surplus in this market before trade is O a. A Ob. B+C O c. A+B+D. O d.c. Supply Demand Refer to Figure 7-21. Which area represents consumer surplus when the price is P1? O a. A O b.B ос. С To a.D
21) Refer to Figure 9-17. Without trade, consumer surplus is 1 point Figure 9-17 1 Price...
21) Refer to Figure 9-17. Without trade, consumer surplus is 1 point Figure 9-17 1 Price Domestic Supply World price + tariff World Price Domestic Demand 4 8 12 16 20 24 28 32 36 40 44 48 52 56 60 64 68 72 76 80 84 88 92 96 100 Quantity O a. $400 and producer surplus is $200. b. $400 and producer surplus is $800. O c. $1,600 and producer surplus is $200. O d. $1,600 and producer...
The utility function of the consumer is u(x1,x2) = (10x1 + x2). a) Plot all the...
The utility function of the consumer is u(x1,x2) = (10x1 + x2). a) Plot all the consumption bundles that gives the consumer utility 100. (3 points) b) Plot all the consumption bundles that gives the consumer utility 144. (3 points) c) Plot the budget constraint when p. = 10,P2 = 10 and m = 100 (3 points) d) Plot the budget constraint when P1 = 20, P2 = 5 and m = 60 (3 points) e) What is the optimal...
Figure Mary's Ice Cream Ashley Ice Cream Refer to Figure. If Mary Ice Cream and Ashley...
Figure Mary's Ice Cream Ashley Ice Cream Refer to Figure. If Mary Ice Cream and Ashley loe Cream are the only two sellers of ice cream in the market, then the market quantity supplied at a price of 56 would 21 units price Q quantity Refer to the above figure: The movement from point B to point A on the graph is caused by a(n) a. increase in price. b. decrease in price decrease in the price of a substitute...
Figure 21-1
The downwardsloping line on the
figure represents a consumer’s budget constraint.
Refer to Figure 21-1. If the
consumer’s income is $140, then what is the price of a CD?
$3
$5
$7
$9
Refer to Figure 21-1. A
consumer who chooses to spend all of her income could be at which
point(s) on the figure?
A only
E only
B, C, or D only
A, B, C, or D only
Refer to Figure 21-20. Assume that the consumer has an income of $40, the price of a bag of marshmallows is $2, and the price of a bag of chocolate chips is $2. The optimizing consumer will choose to purchase which bundle of marshmallows and chocolate chips? a. A b. B. C. C. d. D. 14. Figure 21-18 Refer to Figure 21-18. It would be possible for the consumer to reach I; if a. the price of y decreases. b....
Please explain.
Q7: The following figure shows the indifference curves and budget constraint of a consumer. De- termine the commodity bundle that will maximize the consumer's satisfaction given his budget. Why is the bundle the optimal choice? Good 1 Budget Constraint 0 1 2 3 4 5 6 7 8 9 10 Good 2
l. A consumer has €100 of income to allocate between chocolate and soda. Chocolate costs per unit. (a) Suppose when soda costs 4 per unit, the consumer chooses 20 sodas. Draw the budget constraint and indifference curve to represent this budget and choice. (You can assume that the indifferences curves are regular, ie convex to the origin.) Now the company introduces a deal whereby the price falls to є3.00 if the consumer buys more than 20 sodas. So if the...
Figure 9-11 Price Domestic Supply World Price Domestic Demand Quantity Refer to Figure 9.11. Consumer surplus in this market before trade is O a. A Ob. B+C O c. A+B+D. O d.c. Supply Demand Refer to Figure 7-21. Which area represents consumer surplus when the price is P1? O a. A O b.B ос. С To a.D
21) Refer to Figure 9-17. Without trade, consumer surplus is 1 point Figure 9-17 1 Price Domestic Supply World price + tariff World Price Domestic Demand 4 8 12 16 20 24 28 32 36 40 44 48 52 56 60 64 68 72 76 80 84 88 92 96 100 Quantity O a. $400 and producer surplus is $200. b. $400 and producer surplus is $800. O c. $1,600 and producer surplus is $200. O d. $1,600 and producer...
The utility function of the consumer is u(x1,x2) = (10x1 + x2). a) Plot all the consumption bundles that gives the consumer utility 100. (3 points) b) Plot all the consumption bundles that gives the consumer utility 144. (3 points) c) Plot the budget constraint when p. = 10,P2 = 10 and m = 100 (3 points) d) Plot the budget constraint when P1 = 20, P2 = 5 and m = 60 (3 points) e) What is the optimal...
Figure Mary's Ice Cream Ashley Ice Cream Refer to Figure. If Mary Ice Cream and Ashley loe Cream are the only two sellers of ice cream in the market, then the market quantity supplied at a price of 56 would 21 units price Q quantity Refer to the above figure: The movement from point B to point A on the graph is caused by a(n) a. increase in price. b. decrease in price decrease in the price of a substitute...
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