Question

p. 122 utility-maximizing rule, p. 124 115 ovo LEMS- MyLab Economics de a resolution to lose Fems (Y) 1.2 On January 1, Professor Smith made a resolut some weight and save some money. He decided the would strictly budget $100 for lunches each month lunch, he has only two choices: the faculty club, where the price of a lunch is $5, and Alice's Restaurant, where the price of a lunch is $10. Every day that he does not et lunch, he runs five miles. a. Assuming that Professor Smith spends the $100 each month at either Alice's or the club, sketch his budget con straint. Show actual numbers on the axes. b. Last month Professor Smith chose to eat at the club ten times and at Alice's five times. Does this choice fl his budget constraint? Explain your answer. c. Last month Alice ran a half-price lunch spec All lunches were reduced to $5. Show thee Professor Smith's budget constraint. his choice fit withi ch special all mond . Show the effect on homics to complete these exercises ata are mark Gises online and a

Answer 1

2 let inoma m l00 lot x umuh at Fautty Club So, PS Yumch at Auce Ca Budget cmstraint is 5 X + 10Y= 100 Budget Gmstsannt ro 20 5メ+DY= 5(o)+10(5) 100 X10 Y=5 he is spnding othim his budget cmstamt Gies es this cholce Ry=5 New Budget comtalnt is Y 5X457-100 Nes Budyot Lonsdan old budget Comstalnt

If you have any doubt feel free to ask.

Don't forget to thumbs up if it helped you.