Assume that a consumer has a given budget or income of $24 and that she can buy only two goods, apples or bananas. The price of an apple is $3.00 and the price of a banana is $2.00. For this consumer, the opportunity cost of buying one more apple is Multiple Choice 0.67 of a banana. 1 banana. 1.5 bananas. 0.5 of a banana. < Prev 7 of 60 Next >

Assume that a consumer has a given budget or income of $24 and that she can buy only two goods, apples or bananas. The price of an apple is $3.00 and the price of a banana is $2.00. For this consumer, the opportunity cost of buying one more apple is Multiple Choice 0.67 of a banana. 1 banana. 1.5 bananas. 0.5 of a banana. < Prev 7 of 60 Next >

Principles of Economics (MindTap Course List)

8th Edition

ISBN:9781305585126

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter21: The Theory Of Consumer Choice

Section: Chapter Questions

Problem 12PA

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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.
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Alexi has a budget of $21 to spend on toaster and breads. He does not directly gain any utility from owining a toaster but for every slice of toasted bread he consumes he gain 2 units of utility, that is if he owns a toaster. Without the toaster, he gain 0 units of utility from consuming plain bread. Suppose the toaster has inferior quality and will break after toasting only 10 slices, then Alexi needs to buy a new one. The current market price for cheap toaster is $5 and the price for a single slice of bread is $1. Assume that Alexi aims to maximize consumer surplus. In a graph, draw total utility as a function of number of toasted slices, assuming that Alexi buys 1 toaster.
Alexi has a budget of $21 to spend on toaster and breads. He does not directly gain any utility from owining a toaster but for every slice of toasted bread he consumes he gain 2 units of utility, that is if he owns a toaster. Without the toaster, he gain 0 units of utility from consuming plain bread. Suppose the toaster has inferior quality and will break after toasting only 10 slices, then Alexi needs to buy a new one. The current market price for cheap toaster is $5 and the price for a single slice of bread is $1. Assume that Alexi aims to maximize consumer surplus. Find Alexi's income-consumption curve for slices of bread for incomes between $0 and $21, assuming a price of $1 per slice.
John likes Coca-Cola. After consuming one Coke, John has a total utility of 10 utils. After two Cokes, he has a total utility of 25 utils. After three Cokes, he has a total utility of 50 utils. Does John show diminishing marginal utility for Coke, or does he show increasing marginal utility for Coke? Supposethat John has $3 in his pocket. If Cokes cost $1 each and John is willing to spend one of his dollars on purchasing a first can of Coke, would he spend his second dollar on a Coke, too? What about the third dollar? If John’s marginal utility for Coke keeps on increasing no matter how many Cokes he drinks, would it be fair to say that he is addicted to Coke?
ECON Questions 5, 6, 7, and 8 How to solve and answer these economics questions showed in the screenshot?
John likes Coca-Cola. After consuming one Coke, John has a total utility of 10 utils. After two Cokes, he has a total utility of 25 utils. After three Cokes, he has a total utility of 50 utils. Does John show diminishing marginal utility for Coke or does he show increasing marginal utility for Coke? Suppose that John has $3 in his pocket. If Cokes cost $1 each and John is willing to spend one of his dollars on purchasing a first can of Coke, would he spend his second dollar on a Coke, too? What about the third dollar? If John’s marginal utility for Coke keeps on increasing no matter how many Cokes he drinks, would it be fair to say that he is addicted to Coke? *use tables and/or graphs if possible, please original work
Only typed answer Oscar makes purchases of an existing product (X) such that the marginal utility of the last unit he consumes is 10 utils and the price is $5. He also tries a new product (Y) and the marginal utility of the last unit he consumes is 8 utils and the price is $1. The equal marginal principle suggests that Oscar should Multiple Choice increase his consumption of product X and decrease his consumption of product Y. increase
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