In the following budget constraint- indifference curve graph, Nikki has $120 to spend on blouses and skirts. a. What is the price of a blouse? S C Blouses 10- 9- 8- 7- 10 st 3- 2- 1- Skirts 9 10 11 12 OU
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- Douglas allocates his budget of $24 per week to 3 goods, cereal, books and clothing. Use the table below to answer the following question Quantity Total Utility of Cereal Total Utility of Books TotalUtility of Clothing 1 50 75 25 2 90 135 45 3 120 175 60 4 140 205 70 5 155 225 78 If the price of cereal is $2, the price of books is $3 and the price of clothing is $1, at what point does Douglas maximize his utility?Question 16 The following graph illustrates Tom's preferences for pizza slices and tacos in a given week: Figure 3-1 Quantity of Pizza Slices 20 10 18 17 16- 10 12 14 16 18 20 Quantity ofTacos Refer to Figure 3-1. Assume that Tom has an income of $100 per week, the price of a slice of pizza is $5, and the price of a taco is also $5. If Tom optimizes his purchases, he will choose to purchase which bundle of pizza slices and tacos? (Hint, consider which budget constraint Tom is on.) O A OB OC O O 111111000 14 IGN=Alex wants to maximize his utility. At his current level of consumption, Alex's marginal utility from an aditional cup of coffe is 15 utils, and his marginal utility from an additional can of soda is 11 utils. If the price of a cup of coffee is $3 and the price of a can of soda is 32. Alex Should:
- 8. Normal and inferior goods Shen likes going to the ballpark to watch baseball, and he also is fond of going to the theater to listen to the symphony orchestra. The following diagram shows two of Shen's Indifference curves for going to ballgames and symphonies. With Shen's initial budget constraint (BC₁), he chose to go to five symphonies and three baseball games per month (point X). Then his budget constraint shifted to BC₂, and he chose to go to four symphonies and six ballgames per month (point Y). BALLGAMES 0 0 5 SYMPHONIES BC 8 goods. BC 10 ? of the following choices, which could have shifted Shen's budget constraint from BC, to BC₂? Check all that apply. The price of baseball tickets Increased while his income and the price of symphony tickets stayed the same. The prices of both baseball and symphony tickets decreased while his income stayed the same. His Income increased while the prices of baseball and symphony tickets stayed the same. His Income decreased while the prices of…Hafidh's income is $200 a month. The price of watch is $25 a show, and the price of a Jeans is $15. a) Calculate the equation for Hafidh's budget line b) Draw a graph of Hafidh's budget line with the quantity of Watches on the x-axis. c) If Hafidh's income increased from S200 to 350S. Explain and show how Hafidh's budget line changes with watches on the x-axis.Kim has $40 per week in her entertainment budget. She splits her time between going to the movies and yoga classes. Each movie costs $10 while each yoga class costs $5. a. Graph Kim’s budget constraint, with movies on the x-axis and yoga on the y-axis. What is the value of the x-intercept? What is the value of the y-intercept? What is the slope of this budget constraint? Suppose the total utility from each of these activities is listed in the table below. What is Kim's utility maximizing point? Movies Total Utility Yoga Classes Total Utility 0 0 0 0 1 40 1 30 2 70 2 55 3 90 3 75 4 95 4 90 5 100 5 100 6 105 6 105 movies and yoga classes How much total utility does she obtain from this combination? c. Suppose the price of movies drops to $5 each. What is her new optimal consumption choice? The new slope of her budget constraint is? Kim will choose to consume how many movies and how many yoga…
- 8. Normal and inferior goods Larry likes going to the ballpark to watch baseball, and he also is fond of going to the theater to listen to the symphony orchestra. The following diagram shows two of Larry's indifference curves for going to ballgames and symphonies. With Larry's initial budget constraint (BC), he chose to go to two symphonies and six baseball games per month (point X). Then his budget constraint shifted to BC2, and he chose to go to five symphonies and five ballgames per month (point Y). 2 BALLGAMES Z 0 5 10 SYMPHONICS of the following choices, which could have shifted Larry's budget constraint from BC₁ to BC₂? Check all that apply. His income increased while the prices of baseball and symphony tickets stayed the same. The price of symphony tickets increased while his income and the price of baseball tickets stayed the same. The prices of both baseball and symphony tickets decreased while his income stayed the same. His income decreased while the prices of baseball and…Currently, Paula is maximizing utility by purchasing five TV dinners (T) and four LeanCuisine Meals (L) each week. Suppose both T and L cost $5 each.a. Graph Paula’s initial utility-maximizing choice.b. Suppose the price of T falls by $1 and the price of L rises by $1.25. Can Paula stillafford to buy her initial consumption choices? What do you know about her new budgetconstraint?c. Make a new graph to show why Paula will choose to consume more T and less Lgiven her new budget constraint to maximize utility. Is her utility increased, decreased,or unchanged given the price change? [Hint: try to make the graph as big as possible tosee how the utility is tangent/intersects with the lines more easily] d. In part (b), suppose another scenario where the price of T rises by $1 and the priceof L falls by $1.25. Is Paula’s utility increased, decreased, or unchanged given the pricechange?The total utility schedule of Sharon is given below for the number of shoes she consumes. i. Calculate Sharon’s marginal utility schedule. ii. Plot a graph of total and marginal utility. iii. What is the maximum number of shoes that Sharon will consume? Explain Number of Shoes Total Utility Marginal Utility1 100 2 2003 2754 3255 3506 3607 3608 355 b. Assume that Mania has $1,200 per month to spend between dinners at a Japanese restaurant and evenings at Cru, a local bar. Assume that going to Cru costs $25 and eating at the restaurant costs $14. a. Draw Mania’s budget constraint with restaurants on the horizontal axis.b. Suppose…
- The total utility schedule of Sharon is given below for the number of shoes she consumes. Calculate Sharon’s marginal utility schedule. Plot a graph of total and marginal utility. What is the maximum number of shoes that Sharon will consume? Explain Number of Shoes Total Utility Marginal Utility 1 100 2 200 3 275 4 325 5 350 6 360 7 360 8 355 Assume that Mania has $1,200 per month to spend between dinners at a Japanese restaurant and evenings at Cru, a local bar. Assume that going to Cru costs $25 and eating at the restaurant costs $14. Draw Mania’s budget constraint with restaurants on the horizontal axis. Suppose Mania comes into some money and can now spend an extra $200 per month. Draw her new budget constraint. Suppose the price of restaurants decrease to $12, while her income and the price of Cru is unchanged. Illustrate what happens to her budget line.Raymond consumes meatloaves and pineapples. He has decided that his monthly budget will be $1500. Suppose that one meatloaf costs $375, while one pineapple costs $150. c. Show how Raymond’s budget line changes if the price of pineapples increases to $370. d.. 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?Douglas allocates his budget of $24 per week to 3 goods, cereal, books and clothing. Use the table below to answer the following question Quantity Total Utility of Cereal Total Utility of Books Total Utility of Clothing 1 50 75 25 2 90 135 45 3 120 175 60 4 140 205 70 5 155 225 78 1. If the price of cereal is $2, the price of books is $3 and the price of clothing is $1, at what point does Douglas maximize his utility? Explain.
