not use ai please don't 2. Assume Juanita's budget constraint is originally BC, with the price of good Y being $2.Then her budget constraint changes to BC. (Each box is 2 units)Quantity of Good Y 20181614121086420BCBC0 2 4 6 8 10 12 14 16 18 20 Quantity of Good Xa. What changed for the budget constraint to move from BC, to BC,? Be as specific aspossible. (It is possible to provide what changes, in what direction and a dollar value.)b. Are goods X and Y complements or substitutes? Explain.c. Calculate the ARC cross-price elasticity of demand for good X with respect to good Y.d. Would this change in budget constraint result in a movement along or shift in the demandcurve for good X? Explain.d. Would this change in budget constraint result in a movement along or shift in the demandcurve for good Y? Explain

c. Calculate the ARC cross-price elasticity of demand for Good X with respect to Good Y.To calculate…

Answered: 2. Assume Juanita's budget constraint…

ECON MICRO

5th Edition

ISBN:9781337000536

Author:William A. McEachern

Publisher:William A. McEachern

Chapter6: Consumer Choice And Demand

Section: Chapter Questions

Problem 1.2P

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Similar questions

As a college student you work at a part-time job, but your parents also send you a monthly allowance. Suppose one month your parents forgot to send the check. Show graphically how your budget constraint is affected. Assuming you only buy normal goods, what would happen to your purchases of goods?
Take Jeremys total utility information in Exercise 6.1, and use the marginal utility approach to confirm the choice of phone minutes and round trips that maximize Jeremys utility.
What is the rule relating the ratio of marginal utility to prices of two goods at the optimal choice? Explain why, if this rule does not hold, the choice cannot be utility-maximizing
Would you expect marginal utility to rise or fall with additional consumption of a good? Why?
If a 10 decrease in the price of one product that you buy causes an 8 increase in quantity demanded of that product, will another 10 decrease in the price cause another 3 increase (no more and no less) in quantity demanded?
Is it possible for total utility to increase while marginal utility diminishes? Explain.
1. (a) Which causes a shortage of a good--- a price ceiling or a price floor? Justify your answer with a graph. (b) What is a budget constraint? A consumer has an income of $3000. Soda costs $3 per liter and cheese costs $6 per pound. Draw the consumer's budget constraint with soda on the vertical axis. What is the slope of this budget constraint?
(a) If a consumer has to choose between McDonald burger and King Burger, both are perfect substitute to each other. Explain the conditions of consumer's equilibrium with the help of graph.
7- Define the budget constraint and what does the slope of the budget constraint represent?
- Suppose the price of Pizza is $10 the price of cola is $1, and the consumer's income is $60. In addition, suppose the consumer's budget constraint measures pizza on the horizontal axis and cola on the vertical axis. If the consumer's income rises to $100 while the prices of pizza and cola are constant, then the budget line for pizza and cola would ? a- not change b- now intersect the horizontal axis at 12 pizzas and the vertical: axis at 120 colas c- now intersect the horizontal axis at 10 pizzas and the vertical axis at 100 colas d- would rotate along the cola axis
Which budget constraint panel in Figure below shows the combined effects of an increase in the price of oranges and a decrease in the price of apples? (b) (c) (d) Oranges Oranges Oranges KREKE Apples -(a) Oranges Apples O panel a panel b panel c Apples O panel e Onone of the above Apples (e) Oranges Apples
7. Shifts in a budget constraint Darnell brings $30 to a basketball game to spend on hot dogs and beer. The following diagram shows his budget constraint: 20 18 BC 16 14 12 10 4 2 BC 2 4 6 8 10 12 14 16 18 20 HOT DOGS According to the diagram, hot dogs cost $ each, and beer costs $ per glass. Adjust the diagram to show how Darnell's budget constraint would change if the price of beer decreased. (Assume the price of hot dogs and Darnell's income remain the same.) GLASSES OF BEER

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