Let U(x.y) =V(xy)Let I = $100, Px = $25 and Py = $10 be the initial set of prices and income. Now, let Py fall to $10. What is the compensating variation for this change in prices?O A. 24.50O B. 30.25O C. 36.75O D. 40.40Reset Selection

compensating variation occurs where adjustment is made in income so that consumer is as well off as…

Let U(x,y) =V(xy) . Let I = $100, Px = $25 and Py =$10 be the initial set of prices and income. Now, let Px fall to $10. What is the compensating variation for this change in prices? O A. 24.50 O B. 30.25 O C. 36.75 O D. 40.40 Reset Selection

Let U(x,y) =V(xy) . Let I = $100, Px = $25 and Py =$10 be the initial set of prices and income. Now, let Px fall to $10. What is the compensating variation for this change in prices? O A. 24.50 O B. 30.25 O C. 36.75 O D. 40.40 Reset Selection

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter6: Consumer Choices

Section: Chapter Questions

Problem 10RQ: What is the rule relating the ratio of marginal utility to prices of two goods at the optimal...

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Question

Let U(x.y) =V(xy)
Let I = $100, Px = $25 and Py = $10 be the initial set of prices and income. Now, let Py fall to $10. What is the compensating variation for this change in prices?
O A. 24.50
O B. 30.25
O C. 36.75
O D. 40.40
Reset Selection

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Question 3 Gabriel the consumer, has preferences over goods x and y that are perfect substitutes, where utility is u(x,y) = x+y. He has an income of $152. The price of y is $12. If the price of x falls from $8 to $2, then Gabriel's, optimal choice for good x should rise by units. O 51 O53 55 O 57 --
P2- P1- X Y Z O a $1223.75 Ob $1980.25 Oc. $1246.00 Od $734.25 O e. $489.50 Of $756.50 Time left 05525 Q1 quantity If in the figure above price P1 equals $3.00, price P2 equals $14.00, price P3 equals $30.50, and quantity Q1 equals 89 units, then what is the value of consumer surplus the market equilibrium?
Explanation it correctly and details
QUESTION 2 Consider a consumer named Ahmed who buys only two items, shawarma and coffee. If the total weekly income of Ahmed is OMR 36 and the price of shawarma is 2 OMR while price of coffee is 1.2 OMR, If he chooses to buy 12 quantities of shawarma, then how much quantity of coffee he can buy? O a. 12 Ob.0 O. 18 Od. 30
Find marginal utility for each consumption level for both products and please show your work in Table.
Question 21 Units of Product Marginal Utility, A (Price = $1) Marginal Utility, B (Price = $1) First Second Third Fourth Fifth Sixth Seventh 16 utils. O 54 utils. Ⓒ70 utils. 12 Ⓒ20 utils. 10 8 6 4 2 0 16 14 12 10 8 4 Refer to the data for a consumer whose income = $4. In equilibrium, the introduction of new product C has increased this consumer's total utility by Marginal Utility, New Product, C (Price = $1) 20 18 16 14 12 10 8
options 7536037.5122.5 Question attached
Rasheed's utility function for goods X and Y is U(XY) 2XYY Let Py and Py be the prices for goods X and Y, and let I be Rasheed's income. Rasheed's demand equations for X and Y are: O A 21+Py 21+Px and Y X 4PX 4Pr O B. 21-Px 21 Px X 4P and Y 4P O C. 21-Px 21 Px and Y X= 4Px 4PY O D. X= and Y 2P Y 'X
The figure to the right represents the demand for ice cream cones. Which of the following statements is true? O A. Points a and b may not necessarily be the utility - maximizing quantities of ice cream cones at two different prices because we have no information on the consumer's budget or the price of other goods. B. Points a and b are the utility - maximizing quantities of ice cream cones at two different prices of ice cream. O C. Points a and b are derived independently of the utility - maximizing model. O D. Point a could be a utility - maximizing choice if the price is $3 but point b may not be because we have no information on the marginal utility per dollar when price changes. Price $3 1 3 4 Demand Quantity
30
Suppose the consumer's utility function is given by U(x,y) = X3/5y2/5, and the exogenous variables are given by M = 500, Px = 5, and Py = 4. Price of y changes to Py = 2. What is the income effect ony?O A.-14.53O B. +14.53O C. +24.21O D. +25.79O E. None of the above
Suppose the consumer's utility function is given by U(x,y) = X3/5y2/5, and the exogenous variables are given by M = 500, Px = 5, and Py = 4. Price of y changes to Py = 2. What is the income effect ony?O A.-14.53O B. +14.53O C. +24.21O D. +25.79O E. None of the above Note:- Please avoid using ChatGPT and refrain from providing handwritten solutions; otherwise, I will definitely give a downvote. Also, be mindful of plagiarism. Answer completely and accurate answer. Rest assured, you will receive an upvote if the answer is accurate.