Microeconomics
2nd Edition
ISBN: 9780073375854
Author: B. Douglas Bernheim, Michael Whinston
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Chapter 5, Problem 15P
To determine
Identify Rayan’s best choice and budget set.
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A student has a monthly budget of $120 to spend on either burritos, which cost $6 each, orsodas, which cost $4 each.What is the largest number of burritos that the student could afford to purchase in onemonth?What is the largest number of sodas the student could afford to purchase in one month?
Draw the student's budget constraint. Put burritos on the x-axis and sodas on the y-axis.
The Department of Theatre and Dance at a mythical boarding school puts together a
fundraising talent show called, oddly, Caterpillar Night. The first year, the Department
charges $10 per ticket and 1000 tickets are sold. Data from subsequent years reveals that for
every additional 25¢ charged per ticket, 50 fewer people attend. Conversely, for every 25¢ less
than $10 charged, 50 additional people attend. Based on this data, what price should the
department charge to maximize ticket revenue? Your solution needs to include a revenue
function clearly written out. Beyond that, any type of solution other than guess and check is
acceptable, but explain how you came up with your answer.
3.15 Mandy is ordering a set of football tickets for the coming season. She plans to
sell the tickets to make some money. There are two types of tickets: tickets for
road games and tickets for home games. For each road game ticket, she could
make a profit of $150, and for each home game ticket, the profit is $50 on
average. The ticket office offers two price options:
(a) $5/home ticket, and no more than $50 purchase per person; $50/road
ticket, and no more than $300 purchase per person.
(b) $7.5/home ticket, and no more than S100 purchase per person; $45/road
ticket, and no more than $250 purchase per person.
How many tickets of each type should Mandy purchase so as to maximize the
total profit she can make?
Chapter 5 Solutions
Microeconomics
Ch. 5 - Prob. 1DQCh. 5 - Prob. 2DQCh. 5 - Prob. 3DQCh. 5 - Prob. 4DQCh. 5 - Prob. 1PCh. 5 - Prob. 2PCh. 5 - Prob. 3PCh. 5 - Prob. 4PCh. 5 - Prob. 5PCh. 5 - Prob. 6P
Ch. 5 - Prob. 7PCh. 5 - Prob. 8PCh. 5 - Prob. 9PCh. 5 - Prob. 10PCh. 5 - Prob. 11PCh. 5 - Prob. 12PCh. 5 - Prob. 13PCh. 5 - Prob. 14PCh. 5 - Prob. 15PCh. 5 - Prob. 16PCh. 5 - Prob. 1CPCh. 5 - Prob. 2CPCh. 5 - Prob. 3CPCh. 5 - Prob. 4CPCh. 5 - Prob. 5CPCh. 5 - Prob. 6CPCh. 5 - Prob. 7CPCh. 5 - Prob. 8CP
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