As an economics student your budget for meals at the university is Rs 12,000 and you have two options during the course of you studies: Eating at the university cafeteria for Rs 40 per meal Eating at the dining hall for Rs 10 per meal. b. What would happen to budget constraint if i.your income falls and budget available for meals falls to Rs 8,000. Using your diagram from part (a), show the consequences of this change, assuming both meals are ‘normal’ and label the new optimum as point B. ii. if price of dinning hall meals rises to Rs 20. Using your diagram from part (a), show the price effect and label the new optimum as point B’.
As an economics student your budget for meals at the university is Rs 12,000 and you have two options during the course of you studies: Eating at the university cafeteria for Rs 40 per meal Eating at the dining hall for Rs 10 per meal. b. What would happen to budget constraint if i.your income falls and budget available for meals falls to Rs 8,000. Using your diagram from part (a), show the consequences of this change, assuming both meals are ‘normal’ and label the new optimum as point B. ii. if price of dinning hall meals rises to Rs 20. Using your diagram from part (a), show the price effect and label the new optimum as point B’.
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter6: Consumer Choice Theory
Section6.A: Indifference Curve Analysis
Problem 8SQ
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As an economics student your budget for meals at the university is Rs 12,000 and you have two options during the course of you studies:
Eating at the university cafeteria for Rs 40 per meal
Eating at the dining hall for Rs 10 per meal.
b. What would happen to budget constraint if
i.your income falls and budget available for meals falls to Rs 8,000. Using your diagram from part (a), show the consequences of this change, assuming both meals are ‘normal’ and label the new optimum as point B.
ii. if price of dinning hall meals rises to Rs 20. Using your diagram from part (a), show the price effect and label the new optimum as point B’.
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