What do the budget lines for a voucher for good y and "buy one of good...
What do the budget lines for a voucher for good y and "buy one of good y get the next unit of good y free" have in common?
a) one or more portions of the budget constraint that is a vertical line
b) L-shaped budget constraints
c) Budget constraints that are convex to the origin
d)one or more portions portion of the budget constraint that is a horizontal line
Homework Answers
the budget lines for a voucher for good y and "buy one of good y get the next unit of good y free" have the following in common
a) one or more portions of the budget constraint that is a vertical line
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What do the budget lines for a voucher for good y and "buy one
of good...
Budget lines are drawn on a diagram with the O A. quantity of one good on the vertical axis and the quantity of an...
Budget lines are drawn on a diagram with the O A. quantity of one good on the vertical axis and the quantity of another good on the horizontal axis. OB. quantity of the good on the vertical axis and its price on the horizontal axis. OC. price of one good on the vertical axis and the price of another good on the horizontal axis. OD. price of the good on the vertical axis and its quantity on the horizontal axis.
Question 16 1 pts A typical indifference curve is negatively sloped because: as we consume more...
Question 16 1 pts A typical indifference curve is negatively sloped because: as we consume more of one good, we are willing to give up the consumption of another good without changing our utility higher indifference curves represent higher levels of utility higher indifference curves represent lower levels of utility we assume that a consumer's income is constant Question 17 1 pts A typical indifference curve: O is convex to the origin (bowed in) has a constant slope is concave...
Suppose that price of Good Y is $2 Question 4 consumer had a budget of $36...
Suppose that price of Good Y is $2 Question 4 consumer had a budget of $36 to spend on Good X and Good Y. The price of Good X is $4 and the Tries remaining: 2 The store selling Good X is offer a deal where you can buy one unit of Good X and get the next unit of Good X that Points out of 10.00 you buy for 50% of the original price. Flag question Determine the X-intercept...
3. (3 Points) Intuitively describe what the slope of the budget line tells us about the...
3. (3 Points) Intuitively describe what the slope of the budget line tells us about the consumer's ability to trade goods X and Y. 4. (6 Points) For each description of a change in the budget line given below, state which of the following increases or decreases for the budget constraint variables would cause it: † Px + PxPy. Pytw, and I W. (a) The budget line rotates inward around its horizontal intercept (meaning that it's horizontal intercept does NOT...
Question 9 1 pts Logan Roy is spending all his money income by buying mineral water...
Question 9 1 pts Logan Roy is spending all his money income by buying mineral water and popcorn. At his current consumption level, the marginal utility of mineral water is 70 and the marginal utility of popcorn is 60. The price of a bottle of mineral water is $2.00 and the price of a box of popcorn is $1.50. The utility-maximizing rule suggests that Logan should: O Increase consumption of popcorn and increase consumption of mineral water Decrease consumption of...
Suppose that Jim uses his budget to purchase 100 units of Good X and 100 units...
Suppose that Jim uses his budget to purchase 100 units of Good X and 100 units of Good Y. When the price of Good X rises, he purchases 50 units of Good X and 95 units of Good Y. An economist calculates his compensated budget and finds that in that scenario, Jim would buy 80 units of Good X and 105 units of Good Calculate the income effect (Remember to include a negative sign()it the effect reduces the quantity) Answer:...
Рx Sketch the following budget constraints: Income S20 $1,000 $40 $50 $1,000 $20 $100 $1,000 $20...
Рx Sketch the following budget constraints: Income S20 $1,000 $40 $50 $1,000 $20 $100 $1,000 $20 $50 $2,000 $0.25 $0.25 $7.00 $0.251 $0.50 $7.00 $0.50 $0.25 $7.00 HINT: a. For these problems, graphing is as simple as determining how much of each good X and Y you can buy by dividing your income by the price of each. For a., you can buy 50 of good X because income/Px $1000/20 = 50. Along the same lines you can buy $1000...
The following graph illustrates various cost lines (aka isocost lines), where units of labor are measured...
The following graph illustrates various cost lines (aka isocost lines), where units of labor are measured along the horizontal axis, units of capital are measured along the vertical axis. Assume the wage rate is $20 per unit of labor and the rental rate is $100 per unit of capital. - Isocost Lines (ICL) Units of Capital ICL3 ICL ICL 500 1 000 1 500 Units of Labor 2 000 2 500 3 000 Figure Description: Units of labor are measured...
Quick intuition check via True or False Questions 1. 2. If all prices double and income...
Quick intuition check via True or False Questions 1. 2. If all prices double and income triples, then the budget line will become steeper There are two goods. You know how much of good 1 a consumer can afford if she spends all of her income on good 1. If you knew the ratio of the prices of the two goods, then you could draw the consumer's budget line without any more information. lf good l is on the horizontal...
Name 1. (3 pts.) Draw the budget lines representing the following information. In each case identify...
Name 1. (3 pts.) Draw the budget lines representing the following information. In each case identify the numerical value of the intercepts of the budget line and the slope. a. Initially assume: M-150, P 3, Py-5.Redraw the budget line on the same graph assuming l 90, P 3, Py 5 b. Initially assume: M- 150, Px 3, Py 5. Redraw the budget line assuming Px rose to $6 c. Initially assume: M : 150, Px-3, P,-5, Redraw the budget line...
Budget lines are drawn on a diagram with the O A. quantity of one good on the vertical axis and the quantity of another good on the horizontal axis. OB. quantity of the good on the vertical axis and its price on the horizontal axis. OC. price of one good on the vertical axis and the price of another good on the horizontal axis. OD. price of the good on the vertical axis and its quantity on the horizontal axis.
Question 16 1 pts A typical indifference curve is negatively sloped because: as we consume more of one good, we are willing to give up the consumption of another good without changing our utility higher indifference curves represent higher levels of utility higher indifference curves represent lower levels of utility we assume that a consumer's income is constant Question 17 1 pts A typical indifference curve: O is convex to the origin (bowed in) has a constant slope is concave...
Suppose that price of Good Y is $2 Question 4 consumer had a budget of $36 to spend on Good X and Good Y. The price of Good X is $4 and the Tries remaining: 2 The store selling Good X is offer a deal where you can buy one unit of Good X and get the next unit of Good X that Points out of 10.00 you buy for 50% of the original price. Flag question Determine the X-intercept...
3. (3 Points) Intuitively describe what the slope of the budget line tells us about the consumer's ability to trade goods X and Y. 4. (6 Points) For each description of a change in the budget line given below, state which of the following increases or decreases for the budget constraint variables would cause it: † Px + PxPy. Pytw, and I W. (a) The budget line rotates inward around its horizontal intercept (meaning that it's horizontal intercept does NOT...
Question 9 1 pts Logan Roy is spending all his money income by buying mineral water and popcorn. At his current consumption level, the marginal utility of mineral water is 70 and the marginal utility of popcorn is 60. The price of a bottle of mineral water is $2.00 and the price of a box of popcorn is $1.50. The utility-maximizing rule suggests that Logan should: O Increase consumption of popcorn and increase consumption of mineral water Decrease consumption of...
Suppose that Jim uses his budget to purchase 100 units of Good X and 100 units of Good Y. When the price of Good X rises, he purchases 50 units of Good X and 95 units of Good Y. An economist calculates his compensated budget and finds that in that scenario, Jim would buy 80 units of Good X and 105 units of Good Calculate the income effect (Remember to include a negative sign()it the effect reduces the quantity) Answer:...
Рx Sketch the following budget constraints: Income S20 $1,000 $40 $50 $1,000 $20 $100 $1,000 $20 $50 $2,000 $0.25 $0.25 $7.00 $0.251 $0.50 $7.00 $0.50 $0.25 $7.00 HINT: a. For these problems, graphing is as simple as determining how much of each good X and Y you can buy by dividing your income by the price of each. For a., you can buy 50 of good X because income/Px $1000/20 = 50. Along the same lines you can buy $1000...
The following graph illustrates various cost lines (aka isocost lines), where units of labor are measured along the horizontal axis, units of capital are measured along the vertical axis. Assume the wage rate is $20 per unit of labor and the rental rate is $100 per unit of capital. - Isocost Lines (ICL) Units of Capital ICL3 ICL ICL 500 1 000 1 500 Units of Labor 2 000 2 500 3 000 Figure Description: Units of labor are measured...
Quick intuition check via True or False Questions 1. 2. If all prices double and income triples, then the budget line will become steeper There are two goods. You know how much of good 1 a consumer can afford if she spends all of her income on good 1. If you knew the ratio of the prices of the two goods, then you could draw the consumer's budget line without any more information. lf good l is on the horizontal...
Name 1. (3 pts.) Draw the budget lines representing the following information. In each case identify the numerical value of the intercepts of the budget line and the slope. a. Initially assume: M-150, P 3, Py-5.Redraw the budget line on the same graph assuming l 90, P 3, Py 5 b. Initially assume: M- 150, Px 3, Py 5. Redraw the budget line assuming Px rose to $6 c. Initially assume: M : 150, Px-3, P,-5, Redraw the budget line...
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