Ann has $600,000 that she could consume or leave as a bequest to her daugh ter. Plotting her consumption (C) on the horizontal axis and the bequest (B) 3B on the vertical axis, Ann finds that her indifference curves have slope Distrusting banks, she keeps her wealth in the form of gold. Thus her wealth earns no interest but is protected from inflation. Her bequest to her daughter - is (a) $150,000 (b) $200,000

Ann has $600,000 that she could consume or leave as a bequest to her daugh ter. Plotting her consumption (C) on the horizontal axis and the bequest (B) 3B on the vertical axis, Ann finds that her indifference curves have slope Distrusting banks, she keeps her wealth in the form of gold. Thus her wealth earns no interest but is protected from inflation. Her bequest to her daughter - is (a) $150,000 (b) $200,000

ECON MACRO

5th Edition

ISBN:9781337000529

Author:William A. McEachern

Publisher:William A. McEachern

Chapter9: Aggregate Demand

Section: Chapter Questions

Problem 3.7P

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Assume that Abdullah has RO 44 to spend on Energy drinks and Protein Bars each month and that both goods must be purchased whole (no fractional units). Energy drinks cost RO 8 and Protein Bars cost RO 3 each. Abdullah's preferences for Energy drinks andProtein Bars are summarized by the following information: Energy drinks Protein Bars No. per Month MU/P No. per MU/Py TU MU TU MU Month 1 42 1 18 78 33 3. 108 3 45 4 132 4 54 60 150 162 63 168 66 a. Fill in the figures for marginal utility and marginal utility per dollar both Energy drinks and Protein Bars. b. Are these preferences consistent with the law of ckminishing marginal utility? Explain briefly. c. Given the budget of RO 22, what quantity of Protein Bars and what quantity of Energy drinks will maximize Joe's level of satisfaction? 56
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Assume that Abdullah has RO 44 to spend on Energy drinks and Protein Bars each month and that both goods must be purchased whole (no fractional units). Energy drinks cost RO 8 and Protein Bars cost RO 3 each. Abdullah’s preferences for Energy drinks and Protein Bars are summarized by the following information: Energy drinks Protein Bars No. per Month TU MU MU/Px No. per Month TU MU MU/Py 1 42 1 18 2 78 2 33 3 108 3 45 4 132 4 54 5 150 5 60 6 162 6 63 7 168 7 66 Fill in the figures for marginal utility and marginal utility per dollar both Energy drinks and Protein Bars. Are these preferences consistent with the law of diminishing marginal utility? Explain briefly. Given the budget of RO 22, what quantity of Protein Bars and what quantity of Energy drinks will maximize Joe’s…
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