Question

A household's weekly beef consumption (measured in pounds) is given by the function C(p,/) , where p is the price of beef (measured in dollars per pound) and the household's income is measured in thousands of dollars per year. The statement C(4,80) 0.08 means that: When the price of beef is and household income is with respect to a a rate of

When the price of beef is ( 4, 80, 0.8, dollars per pound, pounds, thousand dollars per year, pounds per dollar per pound, pounds per thousand dollars per year, increasing, decreasing, beef price, household income ) ( 4, 80, 0.8, dollars per pound, pounds, thousand dollars per year, pounds per dollar per pound, pounds per thousand dollars per year, increasing, decreasing, beef price, household income ) and household income is ( 4, 80, 0.8, dollars per pound, pounds, thousand dollars per year, pounds per dollar per pound, pounds per thousand dollars per year, increasing, decreasing, beef price, household income ) ( 4, 80, 0.8, dollars per pound, pounds, thousand dollars per year, pounds per dollar per pound, pounds per thousand dollars per year, increasing, decreasing, beef price, household income ), then beef consumption is ( 4, 80, 0.8, dollars per pound, pounds, thousand dollars per year, pounds per dollar per pound, pounds per thousand dollars per year, increasing, decreasing, beef price, household income ) with respect to ( 4, 80, 0.8, dollars per pound, pounds, thousand dollars per year, pounds per dollar per pound, pounds per thousand dollars per year, increasing, decreasing, beef price, household income ) at a rate of ( 4, 80, 0.8, dollars per pound, pounds, thousand dollars per year, pounds per dollar per pound, pounds per thousand dollars per year, increasing, decreasing, beef price, household income ) ( 4, 80, 0.8, dollars per pound, pounds, thousand dollars per year, pounds per dollar per pound, pounds per thousand dollars per year, increasing, decreasing, beef price, household income ).

Answer 1

Beef consumption by households making $20,000/year is given by Row 1 of Table 9.2 Table 9.2 3.00 3.50 4.00 4.50 (20,p) 2.65 2.59 2.51 2.43 For households making $20,000/year, beef consumption decreases as price goes up. Beef consumption by households making $100, 000/year is given by Row 5 of Table 9.2 p 3.00 3.50 4.00 4.50 (100,P5.79 5.775.60 5.5 For households making $100,000lyear, beef consumption also decreases as price goes up. Beef consumption by households when the price of beef is $3.00lb is given by Column 1 of Table 9.2

Table 9.4 20 40 60 80100 (I,3.00) 265 414 5.11 5.335.79 When the price of beef is $3.00Mb, beef consumption increases as income increases Beef consumption by households when the price of beef is $4.00Mb is given by Column 3 of Table 9.2 Table 9.5 20 10 60 80 100 .4.00) 251 3.94 4.97 5.19 5.60 When the price of beef is $4.00/lb, beef consumption increases as income increases . If the price of beef is held constant, beef consumption for households with various incomes can be read from a fixed column in Table 9.2 on page 352 of the text. For example, the column corresponding to p 3.00 gives the function h(I) f(,3.00); it tells you how much beef a household with income I will buy at $3.00Mb. Looking at the column from the top down, you can see that it is an increasing function of I. This is true in every column. This says that at any fixed price for beef, consumption goes up as household income goes up-which makes sense. Thus, is an increasing function of I for each value of p. . The amount of money spent on beef equals the product of the unit price p and the quantity C of beef consumed Thus, we multiply each entry in Table 9.2 on page 352 of the text by the price at the top of the column. This yields Table 9.6 Table 9.6 Amount of money spent on beof (Sthouseholdweek) Price 20 7.959.07 10.04 10.94 0 12.42 14.18 15.76 17.46 0 15.33 17.50 19.8821.78 80 16.05 18.52 20.7622.82 00 17 37 20.20 22.40 2489 6 . Table 9.7 gives the amount M spent on beef per household per week. Thus, the amount the household spent on beef in a year is 52M.Since the household's annual income is I thousand dollars, the proportion of income spent on beef is 1000 Thus, we need to take each entry in Table 9.7, divide it by the income at the left, and multiply by 0.052. Table 9.8 shows the results able 9.7 Money spent on beef (Shouseholdiweek) Table 9.8 Proportion of annual income spent on beef Price of Beef (S) Price of Beef (S) 20 7.939.07 10.04 10.94 0 12.42 1418 15.76 17.46 $1,000)6015.33 17.50 19.88 21.78 0 16.05 18.52 20.76 22.82 00 17.37 20.20 22.40 24.89 0 0.016 0.018 0.020 0.023 $1,000)60 o.013 0015 0.017 0.019 80 0.010 o012 0.013 0015 00 0.009 0.011 0.012 o013 Income