The figure below illustrates 3 indifference curves and two budget lines for a student whose budget for online gaming is $10/week. The red line illustrates this student's original budget line. After thanksgiving prices change, the blue (dash-dot) line illustrates the student's new (post-price change) budget line. a) What were the original hourly prices of FortDay and PokemonStop? What are the new prices?   b) What is the students optimal bundle at the original prices? How about at the new prices?

Economics Today and Tomorrow, Student Edition
1st Edition
ISBN:9780078747663
Author:McGraw-Hill
Publisher:McGraw-Hill
Chapter5: Buying The Necessities
Section: Chapter Questions
Problem 23AA
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The figure below illustrates 3 indifference curves and two budget lines for a student whose budget for online gaming is $10/week. The red line illustrates this student's original budget line. After thanksgiving prices change, the blue (dash-dot) line illustrates the student's new (post-price change) budget line.

a) What were the original hourly prices of FortDay and PokemonStop? What are the new prices?

 

b) What is the students optimal bundle at the original prices? How about at the new prices?

100
Increasing Utility
50
50
100
200
FortDay hours
Pokemon Stop!! hours
Transcribed Image Text:100 Increasing Utility 50 50 100 200 FortDay hours Pokemon Stop!! hours
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