The figure below shows two of Josie's indifference curves between peaches and cream, as well as her budget constraint (the straight line). Josie, with an income of $32, faces prices of $4 for both peaches and cream. She is currently maximizing utility by consuming 4 peaches and 4 creams. Highlight Josie's current bundle. Then, show what happens to her utility maximizing bundle when Josie's income falls to $20 by drawing a new budget constraint and placing a point Josie's new bundle. Segment • Point + Undo * Redo x Reset 10 80 3 2 1 2 3 4 10 Peaches

The figure below shows two of Josie's indifference curves between peaches and cream, as well as her budget constraint (the straight line). Josie, with an income of $32, faces prices of $4 for both peaches and cream. She is currently maximizing utility by consuming 4 peaches and 4 creams. Highlight Josie's current bundle. Then, show what happens to her utility maximizing bundle when Josie's income falls to $20 by drawing a new budget constraint and placing a point Josie's new bundle. Segment • Point + Undo * Redo x Reset 10 80 3 2 1 2 3 4 10 Peaches

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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