Assume that Sophia has $1000 per month to spend between dinners at a Thairestaurant and evenings at MECA, a local club. Assume that going to MECAcosts $200 and eating at the Thai restaurant costs $100.i. Draw Sophia’s budget constraint. Restaurants on the Y-axis
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Assume that Sophia has $1000 per month to spend between dinners at a Thai
restaurant and evenings at MECA, a local club. Assume that going to MECA
costs $200 and eating at the Thai restaurant costs $100.
i. Draw Sophia’s budget constraint. Restaurants on the Y-axis
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- A student has a monthly budget of $120 to spend on either burrito, which cost $6 each, or sodas, which cost $4 each.Draw the student's budget constraint. Put burritos on the x-axis and sodas on the y-axis. Which combinations of burritos and sodas are unaffordable--those to the left of the line in the graph or those above the line in the graph? Why? Which combinations would leave some budget unspent - those to the left of the line in the above graph or those to the right of the line in the above graph?Raymond consumes meatloaves and pineapples. He has decided that hismonthly budget will be $1500. Suppose that one meatloaf costs $375, while one pineapple costs $150. Suppose Raymond decides to cut his monthly budget in half. Coincidentally, the next time he shops, he learns that meatloaves and pineapples are on sale for half price. Show what happens to Raymond’s budget line?1. An individual's budget Suppose Darnell has a weekly budget of $32 to spend on ranch dressing and spinach. Ranch dressing is priced at $4 per bottle, and spinach is priced at $2 per container. If Darnell spends his entire $32 on ranch dressing, he can buy 16 containers of spinach. 8 bottles of ranch dressing. If he spends his entire $32 on spinach, he can buy Use the blue line (circle symbol) to plot Darnell's budget constraint on the following graph. Next, use the orange point (square symbol) to shade the area that represents combinations of ranch dressing and spinach that are affordable for Darnell. Finally, place the black point (plus symbol) on the point on Darnell's budget constraint that corresponds to a scenario in which Darnell spends $16 on each good. Note: Dashed drop lines will automatically extend to both axes.
- Your parents give you $500 per month to spend on college expenses or other personal expenses. Your parents change their mind, and decide to make a matching offer. They will give $0.25 for every $1 you spend on college expenses, but only up to $100 extra. Graph the effect of a matching allowance increase of $0.25 for each dollar you spend on college expenses, with a $100 limit, on your budget constraint.Suppose John decides to buy 4 units of food and 4 units of clothing with his $12 budget. Would his marginal utility per dollar spent on food be greater than or less than his marginal utility per dollar spent on clothing? What does this tell you about how he should substitute food for clothing if he wanted to increase his utility without spending any more money?Brenda wants to buy new car and has a budget of $25,000. She has just found a magazine that assigns each car an index for styling and an index for gas mileage. Each index runs from 1 to 10, with 10 representing either the most styling or best gas mileage. While looking at the list of cars, Brenda observes that on average, as the style index increases by one unit, the price of the car increases by $6,250. She also observed that as the gas-mileage index rises by one unit, the price of the car increases by $5,000. Illustrate the various combinations of style (S) and gas mileage (G) that Brenda could select with her $25,000 budget. Using the line drawing tool, illustrate Brenda's budget line. Label this line 'Budget Line'. Carefully follow the instructions above, and only draw the required object. Suppose Brenda's preferences are such that she always receives two times as much satisfaction from an extra unit of styling as she does from gas mileage. What type of car will Brenda choose?…
- Raymond consumes meatloaves and pineapples. He has decided that hismonthly budget will be $1500. Suppose that one meatloaf costs $375, while one pineapple costs $150. i. Draw a graph of Raymond’s budget line (meatloaf on the y axis). ii. Show how Raymond’s budget line changes if the price of pineapplesincreases to $370.True or false. A budget constraint, budget line or budget set is a graphical way to illustrate all possible combinations of two goods that a person can afford.Alex has a budget of $100 a month for movie tickets and restaurant meals. A movie ticket will cost $10 and a restaurant meal costs $20. Which of the following combinations is part of Alex’s budget constraint? 4 movie tickets and 4 restaurant meals 2 movie tickets and 4 restaurant meals 2 movie tickets and 5 restaurant meals 2 movie tickets and 1 restaurant meal
- alex has a budget of $100 a month for a movie tickets and restaurant meals. A movie ticket will cost $10 and a restaurant meal costs $20. which of the following combinqtions is part of alexs budget constraint?3.5 Consider you will organize a party. Your budget is $2000 and you will provide champagne (pchampagne-$50) and oysters (poyster=$20). a) Show all possible combinations of champagne and oysters graphically. b) A friend adds $1000 to your party budget. What are the effects on your budget line? c) The store you usually buy your champagne is closed. Now you are forced to buy the champagne at the store in the neighbor town. There the price of champagne is $75. What effect has the higher champagne price on your budget line (Budget $6000)?in a real life, consumers do not sometimes satisfy their budget constraint