Question 7 1.75 pts Please refer to the following information to answer the question (in bold) below: Raghav's annual income is $40,000. He consumes credit hours (CH) of undergraduate education at Niagara University and all other goods (AOG). Each unit of all other goods costs him $1/unit. Assume he has rational preferences. Besides the "Simple" plan, NU also offers the "Standard" tuition plan to students. Under the "Standard" plan: • Tuition costs $3,000 per credit hour for students enrolled in fewer than 12 credit hours • For students enrolled in at least 12 credit hours and no more than 18 credit hours, students pay a flat "full time" tuition price of $36,000. 。 Hint! Please note that the "full time" tuition price of $36,000 covers ALL the credit hours a student enrolls in, up to the 18 credit hour maximum. Students do NOT pay both a $36,000 flat fee AND a 3,000 per credit hour for their first 12 credit hours. They only pay the $36,000 flat price. • For students enrolled in more than 18 credit hours, they pay an extra $2,000 per credit hour surcharge for those credit hours beyond the 18 credit hours. Which of the following statements best captures Raghav's budget constraint under NU's "Standard" plan, for CH < 12? AOG = 40,000 - 2,500CH = AOG 40,000 - 3,000CH AOG = 36,000 - 3,000CH AOG = 36,000
Question 7 1.75 pts Please refer to the following information to answer the question (in bold) below: Raghav's annual income is $40,000. He consumes credit hours (CH) of undergraduate education at Niagara University and all other goods (AOG). Each unit of all other goods costs him $1/unit. Assume he has rational preferences. Besides the "Simple" plan, NU also offers the "Standard" tuition plan to students. Under the "Standard" plan: • Tuition costs $3,000 per credit hour for students enrolled in fewer than 12 credit hours • For students enrolled in at least 12 credit hours and no more than 18 credit hours, students pay a flat "full time" tuition price of $36,000. 。 Hint! Please note that the "full time" tuition price of $36,000 covers ALL the credit hours a student enrolls in, up to the 18 credit hour maximum. Students do NOT pay both a $36,000 flat fee AND a 3,000 per credit hour for their first 12 credit hours. They only pay the $36,000 flat price. • For students enrolled in more than 18 credit hours, they pay an extra $2,000 per credit hour surcharge for those credit hours beyond the 18 credit hours. Which of the following statements best captures Raghav's budget constraint under NU's "Standard" plan, for CH < 12? AOG = 40,000 - 2,500CH = AOG 40,000 - 3,000CH AOG = 36,000 - 3,000CH AOG = 36,000
Economics Today and Tomorrow, Student Edition
1st Edition
ISBN:9780078747663
Author:McGraw-Hill
Publisher:McGraw-Hill
Chapter1: What Is Economics
Section1.3: What Do Economists Do?
Problem 5R
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Transcribed Image Text:Question 7
1.75 pts
Please refer to the following information to answer the question (in bold) below:
Raghav's annual income is $40,000. He consumes credit hours (CH) of undergraduate education at Niagara University and all other
goods (AOG). Each unit of all other goods costs him $1/unit. Assume he has rational preferences.
Besides the "Simple" plan, NU also offers the "Standard" tuition plan to students.
Under the "Standard" plan:
• Tuition costs $3,000 per credit hour for students enrolled in fewer than 12 credit hours
• For students enrolled in at least 12 credit hours and no more than 18 credit hours, students pay a flat "full time" tuition
price of $36,000.
。 Hint! Please note that the "full time" tuition price of $36,000 covers ALL the credit hours a student enrolls in, up to the 18
credit hour maximum. Students do NOT pay both a $36,000 flat fee AND a 3,000 per credit hour for their first 12 credit
hours. They only pay the $36,000 flat price.
• For students enrolled in more than 18 credit hours, they pay an extra $2,000 per credit hour surcharge for those credit
hours beyond the 18 credit hours.
Which of the following statements best captures Raghav's budget constraint under NU's "Standard" plan, for CH < 12?
AOG = 40,000 - 2,500CH
=
AOG 40,000 - 3,000CH
AOG = 36,000 - 3,000CH
AOG = 36,000
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