Answered: O $60 $0.50 An individual allocates…

O $60 $0.50 An individual allocates $120 a month for spending on coffee and tea at their workplace. Using the budget constraint appearing above, the price of tea is: $1.50 60 $2 80 Tea

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 12RQ: Why does a change in income cause a parallel shift in the budget constraint?

See similar textbooks

Related questions

Q: alex has a budget of $100 a month for a movie tickets and restaurant meals. A movie ticket will cost…

A: Income per month(M) = $100 Two goods: Movie ticket(M) & Restaurant meal(R) Price of Movie ticket…

Q: Jo buys muffins and cupcakes at a bakery. Jo’s weekly budget for baked goods is $70. The price of…

A: The budget equation measures the amount of two goods that a consumer can purchase given the prices…

Q: Question 14 (2 8. R 3. T-shirts The above diagram represents Ken's budget constraint for T'shirts…

A: Price has an inverse relationship with quantity demanded.

Q: Raymond consumes meatloaves and pineapples. He has decided that his monthly budget will be $1500.…

A: Budget constraint refers to all possible combinations of goods that someone can afford, given the…

Q: Basil is a broke college student who consumes only coffee and pizza. No one is really sure how he…

A: Budget constraint is the aggregate amount of items someone can afford within a current budget.…

Q: Douglas allocates his budget of $24 per week to 3 goods, cereal, books and clothing. Use the table…

A: Utility maximization was first developed by utilitarian philosophers Jeremy Bentham and John Stewart…

Q: The table shows the marginal benefit that Marcus derives by consuming different quantities of hotdog…

A: Marginal benefits refer to the additional benefit a consumer derives from additional consumption of…

Q: What is the concept of diminishing marginal utility of consumers? How consumer use Marginal Rate of…

A: "Marginal utility represents the addition to the total utility from consuming one more unit of the…

Q: Coffee 60 80 Tea An individual allocates $180 a month for spending on coffee and tea at their…

A: Budget constraint: given the price of 2 goods and consumer’s income. The budget constraint shows…

Q: Suppose you have $48 to spend on the two items in the graph below. Q books 4 A 1 2 6 8 Q…

A: If movie costs $8 line B represents my budget constraint. If books costs $12 line B represents my…

Q: Jody has $360 to spend on her summer vacation. She decided to use the moneyon trips to the zoo and…

A: The equation will be written as; X * P_m + Y * P_z <= $360Explanation:Creating a Spending Plan…

Q: Consider the following budget constraint. Dennis spends all his money on sweaters and sweatshirts.…

A: Following budget constraint is given:Price of sweater = $15

Q: The nearby graph shows Claudia's budget constraint for purchases of shoes and purses. Claudia's…

A: A budget line is the graphical representation of different combinations of goods to be purchased for…

Q: The table below shows total utility for two products. Suppose that the price for product A is $5 and…

A: Marginal utility refers to the additional units of satisfaction derived from one more additional…

Q: Consumer choice Jo buys muffins and cupcakes at a bakery. Jo’s weekly budget for baked goods is $70.…

A: The combination of goods that a consumer can buy from his given income or wealth is known as a…

Q: The table below shows the marginal utilities in utils that Sarah derives from consuming two goods,…

Q: riefly outline and explain some of factors that depend on line amount of a commodity a consumer os…

A: The dependent variable is Quantity demanded. The independent variables are Price and Income. We have…

Q: Question 25 Burritos 160. 9 009654 8 7 3 2 - 1 3 0 0 0 о 1 O $25 2 3 4 5 6 7 The graph shown…

A: The budget constraint is the mathematical relationship between the income of a consumer and bundles…

Q: draw the budget constraint for a person with income of $ 1000 if the price of pepsi is $5 and the…

A: A budget constraint is a term used in economics to describe all of the different combinations of…

Q: Suppose Alex has income of $100 per month. He only consumes pizza and cell phone minutes. Illustrate…

A: Budget constraint: Budget constraint is a utility concept that is used in maximizing the utility…

Q: The table below represents Sue's preferences for bottled water and soft drinks, the combination of…

A: Budget constraints shows the relationship between the two goods , their prices and the income of…

Q: Joseph earns $200 per week and spends his entire income on cheese which cost $5 per pound and…

A: In the language of economics, a budget constraint is a symbol for the restrictions and decisions…

Q: xplain the difference between marginal utility and total utility

A: Utility is a term referring to the overall satisfaction obtained from consuming a good or service.

Q: Joy’s budget permits her to spend $5,000 per month on either business travel or electronicmedia to…

A: a) Given Income (M) = $5000 Price of business travel = $$1000 Price of electronic media = $500…

Q: suppose a consumer's marginal rate of substitute is three slice of pizza for one coke . if the price…

A: Given, MRS pizza for coke = MU of Pizza/ MU of coke = 3/1= 3 The optimal condition where the…

Q: Answer the question based on the following graph. Which of the following statements is entirely…

A: The curve is budget constraint that shows budget set that is units of two goods a consumer can buy…

Q: The nearby graph shows Charlie's budget constraint for purchases of shoes and purses. Number of 12…

A: The budget line is the locus of all affordable consumption bundles at the given income of the…

Q: Jo buys muffins and cupcakes at a bakery. Jo’s weekly budget for baked goods is $70. The price of…

A: Budget constraints shows the relationship between the goods , price of goods and income of consumer.…

Q: Refer to the information provided in Figure 6.4 below to answer the question(s) that follow. Number…

A: Consumer behaviour is examined by consumer theory, which considers how customers allocate their…

Question

O $60
$0.50
An individual allocates $120 a month for spending on coffee and tea at their
workplace. Using the budget constraint appearing above, the price of tea is:
$1.50
60
$2
80
Tea

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1: Define budget constraint

VIEW

Step 2: Choose correct option

VIEW

Solution

VIEW

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

As a college student you work at a part-time job, but your parents also send you a monthly allowance. Suppose one month your parents forgot to send the check. Show graphically how your budget constraint is affected. Assuming you only buy normal goods, what would happen to your purchases of goods?
Why does a change in income cause a parallel shift in the budget constraint?
dont use chatgpt answer and correct answer i will 10 upvotes.
Consumer choiceJo buys muffins and cupcakes at a bakery. Jo’s weekly budget for baked goods is $70. The priceof muffins is $1.25. The price of cupcakes is $1.75.a) Write down Jo’s budget constraint: express the quantity of cupcakes as a function of thequantity of muffins.
Explain which of the following must have happened between those weeks for Paul’s optimal bundle to move from B to C: Increase in coffee price Reduction of coffee price Increase in Paul’s weekly budget for hot drinks Reduction of Paul’s weekly budget for hot drinks
Consider the following budget constraint. Dennis spends all his money on sweaters and sweatshirts. If the price of sweaters is $15, how much money does Dennis have in his budget? Sweatshirts 8 7 6 5 4 3 2 1 1 0 1 $178 $105 $7 $75 2 3 4 5 6 7 8 9 Sweaters
Raymond consumes meatloaves and pineapples. He has decided that hismonthly budget will be $1500. Suppose that one meatloaf costs $375, while onepineapple costs $150.i. What is the expression for Raymond’s budget constraint
Joseph earns $200 per week and spends his entire income on cheese which cost $5 per pound and crackers which cost $ 2 per box. Draw Josephs budget constraint. If the price of cheese increases to $8 per pound, what will happen to Josephs budget constraint?
If Porsha view 3 glasses of juice as a perfect substitute for one cup of soda and vice versa, what is her marginal rate of substitution between juice and soda?
Consumer choiceJo buys muffins and cupcakes at a bakery. Jo’s weekly budget for baked goods is $70. The priceof muffins is $1.25. The price of cupcakes is $1.75.a) Write down Jo’s budget constraint: express the quantity of cupcakes as a function of thequantity of muffins.b) Show Jo’s budget constraint on a graph. Let quantity of muffins be on the horizontal axis. Letquantity of cupcakes be on the vertical axis.c) Show the following consumption bundles (points) on the graph. Calculate the cost of eachconsumption bundle and state which one of them are feasible.• Point A: 49 muffins and 3 cupcakes.• Point B: 38 muffins and 15 cupcakes.• Point C: 24 muffins and 24 cupcakes.• Point D: 14 muffins and 30 cupcakes.d) Which of these four points can be Jo’s optimal consumption bundle? Why?e) The price of cupcakes decreased to $1.5. Provide an example of a consumption bundle thatbecame feasible now but wasn’t feasible before the decrease in price. Calculate the cost ofthis consumption bundle…
Consumer choiceJo buys muffins and cupcakes at a bakery. Jo’s weekly budget for baked goods is $70. The priceof muffins is $1.25. The price of cupcakes is $1.75.a) Write down Jo’s budget constraint: express the quantity of cupcakes as a function of thequantity of muffins.b) Show Jo’s budget constraint on a graph. Let quantity of muffins be on the horizontal axis. Letquantity of cupcakes be on the vertical axis.c) Show the following consumption bundles (points) on the graph. Calculate the cost of eachconsumption bundle and state which one of them are feasible.• Point A: 49 muffins and 3 cupcakes.• Point B: 38 muffins and 15 cupcakes.• Point C: 24 muffins and 24 cupcakes.• Point D: 14 muffins and 30 cupcakes.
alex has a budget of $100 a month for a movie tickets and restaurant meals. A movie ticket will cost $10 and a restaurant meal costs $20. which of the following combinqtions is part of alexs budget constraint?