How many pieces of sushi and how many bagels did Deborah consume before the price change? pieces of sushi and |bagels At the new prices, how much money would it have cost Deborah to by those same quantities (that is, the quantities that she consumed before the price change)? 24 Given that it used to take Deborah's entire $210 to buy those quantities, how big is the income effect caused by the lower price of bagels? %24 %24

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
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**Budget Allocation Problem**

Suppose that with a budget of $210, Deborah spends $126 on sushi and $84 on bagels when sushi costs $2 per piece and bagels cost $2 per bagel. Then, the price of bagels falls to $1 per bagel.

**Instructions:** Enter your answers as a whole number.

1. **How many pieces of sushi and how many bagels did Deborah consume before the price change?**

   ___ pieces of sushi and ___ bagels

2. **At the new prices, how much money would it have cost Deborah to buy those same quantities (that is, the quantities that she consumed before the price change)?**

   $ ___

3. **Given that it used to take Deborah’s entire $210 to buy those quantities, how big is the income effect caused by the lower price of bagels?**

   $ ___
Transcribed Image Text:**Budget Allocation Problem** Suppose that with a budget of $210, Deborah spends $126 on sushi and $84 on bagels when sushi costs $2 per piece and bagels cost $2 per bagel. Then, the price of bagels falls to $1 per bagel. **Instructions:** Enter your answers as a whole number. 1. **How many pieces of sushi and how many bagels did Deborah consume before the price change?** ___ pieces of sushi and ___ bagels 2. **At the new prices, how much money would it have cost Deborah to buy those same quantities (that is, the quantities that she consumed before the price change)?** $ ___ 3. **Given that it used to take Deborah’s entire $210 to buy those quantities, how big is the income effect caused by the lower price of bagels?** $ ___
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