Could you please assist Q1. Terin works as a motor car mechanic and earns K1200/fortnight. Assuming he strictly allocates his income between food and clothes. The average food consumption price is K12/kg per fortnight and average clothes purchasing price is K20/piece per fortnight. iv. V. Complete the budget schedule below. Baskets/Combinations Food/kg fortnight Cloth pieces/fortnight A 0 B 12 C 24 D 36 E 48 F 60 Assuming the price of food fell to K8/kg per fortnight while the income, price and quantity of clothes purchased remained unchanged (as in 6iii above). Draw a new schedule showing this change. Draw a budget line for the budget schedules (6iii &iv) above and label correctly.

Could you please assist Q1. Terin works as a motor car mechanic and earns K1200/fortnight. Assuming he strictly allocates his income between food and clothes. The average food consumption price is K12/kg per fortnight and average clothes purchasing price is K20/piece per fortnight. iv. V. Complete the budget schedule below. Baskets/Combinations Food/kg fortnight Cloth pieces/fortnight A 0 B 12 C 24 D 36 E 48 F 60 Assuming the price of food fell to K8/kg per fortnight while the income, price and quantity of clothes purchased remained unchanged (as in 6iii above). Draw a new schedule showing this change. Draw a budget line for the budget schedules (6iii &iv) above and label correctly.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Could you please assist
Q1. Terin works as a motor car mechanic and earns
K1200/fortnight. Assuming he strictly allocates his
income between food and clothes. The average food
consumption price is K12/kg per fortnight and average
clothes purchasing price is K20/piece per fortnight.
iii.
iv.
V.
Complete the budget schedule below.
Baskets/Combinations
Food/kg fortnight
Cloth pieces/fortnight
A
0
B
12
C
24
D
36
E
48
F
60
Assuming the price of food fell to K8/kg per fortnight while the income, price and
quantity of clothes purchased remained unchanged (as in 6iii above). Draw a new
schedule showing this change.
Draw a budget line for the budget schedules (6iii &iv) above and label correctly.

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Step 1: Definition of budget Constraint

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Step 2: schedule for part (iii)

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Step 3: Schedule after price for food changes

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Step 4: Graph for (iii) and (iv)

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