Jane's marginal rate of substitution of soft drinks for sandwiches is 1/2. This implies that Jane...
Jane's marginal rate of substitution of soft drinks for sandwiches is 1/2. This implies that Jane is
willing to give up:
a. 1/2 sandwich to obtain an additional soft drink
b. 1/2 soft drink to obtain an additional sandwich
c. 2 sandwiches to obtain an additional soft drink
d. 1/2 dollar to obtain an additional soft drink
Homework Answers
margina rate of substitution is the rate at which we are able to substitute one good for other such that the level of satisfaction is same,
so answer here is A
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Jane's marginal rate of substitution of soft drinks for
sandwiches is 1/2. This implies that Jane...
co Jane has 11 liters of soft drinks and 8 sandwiches. Bob, on the other hand,...
co Jane has 11 liters of soft drinks and 8 sandwiches. Bob, on the other hand, has 9 liters of soft drinks and 12 sandwiches. With these endowments, Jane's marginal rate of substitution (MRS) of soft drinks for sandwiches is 4 and Bob's MRS is equal to 2. Draw an Edgeworth box diagram to show whether this allocation of resources is efficient. If it is explain why. If it is not, what changes will make both parties better off? ....
4. Jane lives in a dormitory that offers soft drinks and chips for sale in vending...
4. Jane lives in a dormitory that offers soft drinks and chips for sale in vending machines. Her utility function is U 3SC (where S is the number of soft drinks per week and C marginal utility of C is 3S. Soft drinks are priced at S0.50 each, chips SO0.25 per bag. a. Determine the marginal rate of substitution between soft drinks and chips. the number of bags of chips per week), so her marginal utility of S is 3C...
if at a given combination of X and Y in consumers marginal rate of substitution is...
if at a given combination of X and Y in consumers marginal rate of substitution is 4, this means that the consumer is willing to give up units of Y for another blank units of X for another X or y
1. Suppose the price of a taco is $1 and the price of a soft drink...
1. Suppose the price of a taco is $1 and the price of a soft drink is $2. If Mehmet has $5, then he can buy: A) four tacos and two soft drinks B) three tacos and two soft drinks C) four tacos and one soft drink D) three tacos and one soft drink 2. Tena has $50 per week to spend on lunches. Egg rolls cost $2 each and a plate of chow mein costs $7. Tena wants to...
Jane's income is $500 a semester. The price of one day of skiing per semester is...
Jane's income is $500 a semester. The price of one day of
skiing per semester is $100, and the price of one day of horseback
riding is also $100. The figure shows Jane's preference map for
days of skiing and horse back riding per semester.
What quantities of days of skiing and days of horseback riding
does Jane buy? What is Jane's marginal rate of substitution at the
point at which she consumes?
Suppose that the price of one day...
#2 b 2. Draw indifference curves that represent the follow- ing individuals' preferences for hamburgers and...
#2
b 2. Draw indifference curves that represent the follow- ing individuals' preferences for hamburgers and soft drinks. Indicate the direction in which the individuals' satisfaction (or utility) is increasing. a. Joe has convex indifference curves and dislikes both hamburgers and soft drinks. b. Jane loves hamburgers and dislikes soft drinks. If she is served a soft drink, she will pour it down the drain rather than drink it. c. Bob loves hamburgers and dislikes soft drinks. If he is...
2) (30 pts) Suppose that the market demand for soft drinks in a small town in...
2) (30 pts) Suppose that the market demand for soft drinks in a small town in Western Massachusetts is given as follows: P = 47-Q A firm producing soft drinks can do so at a marginal cost of $2 (per gallon). There is no fixed cost. Soft drinks are a homogenous good. a. What is the profit maximizing level of output and price of a monopolist? b. What will be the level of output and price in the market if...
Carbon Corporation develops and markets soft drinks and related products in the United States. Its product...
Carbon Corporation develops and markets soft drinks and related products in the United States. Its product line consists of three beverage brands: Carbon Soda, a carbonated drink; Health Aqua, an enhanced water beverage; and Mango and Orange Carbon, two fruit-based drinks. The company’s CEO firmly believes that there is huge potential in the multi-billion dollar energy drink market. Which of the following, if true, would weaken the argument for the introduction of a Carbon energy drink? A The demand for...
what is the marginal rate of substitution (MRS)? a) The ratio of the amounts of the...
what is the marginal rate of substitution (MRS)? a) The ratio of the amounts of the two goods at a point on the indifference curve. b) The amount of one good that the consumers is willing to trade for one unit of the other. c) The change in the consumers utility when one good is substituted for another. d) The slope of the indifference curve.
just need parts e,f,g 2. Jane's utility function defined over two goods x and y is...
just need parts e,f,g
2. Jane's utility function defined over two goods x and y is U (x,y) = x/2y12. Her income is M and the prices of the two goods are p, and p. (a) Find the Marshallian demand curves. (b) Find the Hicksian demand curves. (c) Find the indirect utility function. (d) Find the expenditure function. (e) Determine the substitution and income effects for good r when ini- tially M =$12, P. = $2.P, = $1, and then...
co Jane has 11 liters of soft drinks and 8 sandwiches. Bob, on the other hand, has 9 liters of soft drinks and 12 sandwiches. With these endowments, Jane's marginal rate of substitution (MRS) of soft drinks for sandwiches is 4 and Bob's MRS is equal to 2. Draw an Edgeworth box diagram to show whether this allocation of resources is efficient. If it is explain why. If it is not, what changes will make both parties better off? ....
4. Jane lives in a dormitory that offers soft drinks and chips for sale in vending machines. Her utility function is U 3SC (where S is the number of soft drinks per week and C marginal utility of C is 3S. Soft drinks are priced at S0.50 each, chips SO0.25 per bag. a. Determine the marginal rate of substitution between soft drinks and chips. the number of bags of chips per week), so her marginal utility of S is 3C...
1. Suppose the price of a taco is $1 and the price of a soft drink is $2. If Mehmet has $5, then he can buy: A) four tacos and two soft drinks B) three tacos and two soft drinks C) four tacos and one soft drink D) three tacos and one soft drink 2. Tena has $50 per week to spend on lunches. Egg rolls cost $2 each and a plate of chow mein costs $7. Tena wants to...
Jane's income is $500 a semester. The price of one day of
skiing per semester is $100, and the price of one day of horseback
riding is also $100. The figure shows Jane's preference map for
days of skiing and horse back riding per semester.
What quantities of days of skiing and days of horseback riding
does Jane buy? What is Jane's marginal rate of substitution at the
point at which she consumes?
Suppose that the price of one day...
#2
b 2. Draw indifference curves that represent the follow- ing individuals' preferences for hamburgers and soft drinks. Indicate the direction in which the individuals' satisfaction (or utility) is increasing. a. Joe has convex indifference curves and dislikes both hamburgers and soft drinks. b. Jane loves hamburgers and dislikes soft drinks. If she is served a soft drink, she will pour it down the drain rather than drink it. c. Bob loves hamburgers and dislikes soft drinks. If he is...
2) (30 pts) Suppose that the market demand for soft drinks in a small town in Western Massachusetts is given as follows: P = 47-Q A firm producing soft drinks can do so at a marginal cost of $2 (per gallon). There is no fixed cost. Soft drinks are a homogenous good. a. What is the profit maximizing level of output and price of a monopolist? b. What will be the level of output and price in the market if...
just need parts e,f,g
2. Jane's utility function defined over two goods x and y is U (x,y) = x/2y12. Her income is M and the prices of the two goods are p, and p. (a) Find the Marshallian demand curves. (b) Find the Hicksian demand curves. (c) Find the indirect utility function. (d) Find the expenditure function. (e) Determine the substitution and income effects for good r when ini- tially M =$12, P. = $2.P, = $1, and then...
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