1. An individual's budgetSuppose 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 pricedat $2 per container.If Darnell spends his entire $32 on ranch dressing, he can buy16 containers of spinach.8 bottles of ranch dressing. If he spends his entire $32 on spinach, he can buyUse the blue line (circle symbol) to plot Darnell's budget constraint on the following graph. Next, use the orange point (square symbol) to shade thearea that represents combinations of ranch dressing and spinach that are affordable for Darnell. Finally, place the black point (plus symbol) on thepoint 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.

Step 1: Represent the categories using variables.Step 2: Set up the equation using the information…

Answered: 1. An individual's budget Suppose…

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter6: Consumer Choice Theory

Section: Chapter Questions

Problem 8SQP

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1. An individual's budget Suppose Musashi has a weekly budget of $24 to spend on juice and yogurt. Juice is priced at $2 per gallon, and yogurt is priced at $6 per container. If Musashi spends his entire $24 on juice, he can buy gallons of juice. If he spends his entire $24 on yogurt, he can buy containers of yogurt. Use the blue line (circle symbol) to plot Musashi's budget constraint on the following graph. Next, use the orange point (square symbol) to shade the area that represents combinations of juice and yogurt that are affordable for Musashi. Finally, place the black point (plus symbol) on the point on Musashi's budget constraint that corresponds to a scenario in which Musashi spends $12 on each good. Note: Dashed drop lines will automatically extend to both axes. 24 22 20 BC, ($24) 18 16 Affordable Region 14 12 $12 on Each 6. 4 BC, ($48) 4 6. 8 10 12 14 16 18 24 JUICE (Gallons) 22 20 10 2) YOGURT (Containers)
Consider the following table, which listsJames’s marginal utility schedule for steak andhamburger meals: Given a budget of $45, how many steak and hamburgermeals will James buy per month to maximizehis total utility? What is the total utilityrealized?
i already have the answer, can u answer the explanation clearly?
Question 2
How can one's choice of purchases/consumption be infuenced by utility or marginal utility?
Ryan has $30 per week to spend on snacks. She is a bit health conscious so she prefers to buy either alkaline water which is $5 per liter or protein bars which cost $3 per bar A. Use the graph to plot her budget line given the info above B. The price of protein bars increases to $4. Draw her new budget line(assume she can purchase fractions of water bottles or protein bars. C. Ryan’s weekly budget decreases to $24 while the price of protein bars stays at $4 and the price of water bottles stays at $5. Draw her new budget line (assume she can purchase fractions of water bottles or protein bars)
7. Bob receives utility from days spent traveling on vacation domestically (D) and daysspent traveling in a foreign country (F) as given by the utilityU(D; F) = DFThe price of a day spent traveling domestically is 160 pounds and in a foreigncountry 200 pounds. Bobís annual budget for traveling is 8000 pounds. (a) Find Bobís utility maximising choice of days traveling domestically and of daystravelling in a foreign country. Find also his utility level from consuming thatbundle. Suppose that the price of domestic traveling increases to 250 pounds per day.Denoting his budget for traveling x, (suppose by now that it is unknown) findthe demand for D and F under the new prices as a function of x.
Question 9
. Draw the student's budget constraint. Put burritos on the x-axis and sodas on the y-axis. A student has a monthly budget of $120 to spend on either burritos, which cost $6 each, or sodas, which cost $4 each.
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?…
As described in Exercise 8.1, Lucy wants carpets and paintings for here office. Her company has given her a budget of $7200 for this purpose. Persian carpets of the size that she wants can be purchased for $900 each and paintings from a local Native American artist cost $400 each. Using Excel's charting tool, draw Lucy's budget constraint if her budget is $5000. Use 0, 1, 2, 3, and 5 carpets as possible quantities. Put carpets on the horizontal axis and paintings on the vertical axis.
6. Indifference curves and utility maximization Giberto plays the violin as part of a string trio and advertises booking opportunities using brochures he distributes in bars around the oity. Making one graysale brochure costs$0.02, but adding color increases the cost to$0.08per brochure. Gilberto sets aside a monthly budget of$14,00for creating brochures. The following graph shows three of Gaberto's indifference curves for the number of grayscale and color brochures that he makes. Use the green line (triangle symbol) to plot Giberto's budget constraint. Then, place the black point (alus symbol) on the graph to indicate Giberto's optimal consumption choice given that budget constraint. optimal consumption choice given that budget constraint.

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