You have two options for how to spend the afternoon. You can either go see a movie with your roommate or work as a tutor for the MathDepartment. From experience, you know that going to see a movie gives you $20 worth of enjoyment, and with your student discount, a movie ticketonly costs $12. If you spend the afternoon working as a math tutor, you will get paid $45. On a typical day, you wouldn't be willing to spend theafternoon working as a math tutor for less than $35. What is your opportunity cost of seeing a movie this afternoon?Select one:O a. $57O b. $12○ c. $22○ d. $8

Your opportunity cost for seeing a movie would be $57. AmountMovie ticket (discounted)-$12Math…

Answered: You have two options for how to spend…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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#50
Suppose you go to Trader Joe's to buy fruit for the week. You only like apples (A) and bananas (B) and your weekly fruit budget is $11. When you arrive at Trader Joe's you notice that the price of an apple is $1.00 and the price of a banana is $0.25. QUESTION #1: How many apples and bananas should you buy? QUESTION #2: When you have found the answer, draw a diagram that shows the outcome. Step #1. Determine your preferences. Let's suppose that your preferences can be represented by the following utility function: U(A, B) = AªBß = A0.40 B0.60 FYI: This utility function is known as a Cobb-Douglas utility function. It is the most commonly used function used in economics! The reason we like it so much is that it has: 1. Constant returns (double your consumption of A and B and your utility doubles); a + B = 1 2. Diminishing marginal utility (the extra utility gained from consuming A (or B) decreases as you consume more of the A good (or B good); a 0.40); B > a. Step #2: Determine your…
Sean is arguing with his girlfriend, Yvette. They have been going out for a little more than two years. YVETTE: I'm leaving you, Sean. Get over it. SEAN: Are you saying that being single will make you happier than you've been with me? Speaking personally, I think the utility we've had in this relationship was much more than you could have had if you'd been single this whole time! YVETTE: I had taken an economics class and the word "utility" rings a bell. It's not that at all. We've had a fine time. It's that the utility I would get by continuing our relationship isn't worth it anymore. SEAN: I've never been dumped by someone citing the law of before. You're a piece of work, you know that? Yvette doesn't hear. She has already walked off, leaving Sean feeling like something of a sunk cost.
Sam promises to pay $200 per month to a local police officer, Brenda, (who is already paid a salary by the city where the neighborhood is located) to "patrol my neighborhood while you are on duty." Brenda does the patrol of the neighborhood for several months and demands payment pursuant to the contract that was put in writing. Who wins and why?
Catherine wins a non-transferable, non-refudnable ticket to attend Saturday's baseball game. Taylor plans to attend the same game, but she knows from experience she can purchase a $40 ticket the day of the game. On the day of the game, it is cold with off-and-on rain showers, weather that both Catherine and Taylor equally dislike, making the prospect of attending the game less attractive than before. If both Catherine and Taylor have the same tastes and rational: a. Is one of them more likely to attend the baseball game than the other? b. Instead of winning a ticket, assume that last week Catherine paid $40 for the non-trasnferable, non-refundable ticket to Saturday's game. Would this change whether or not one of them is more likely to attend the baseball game?
If your annual demand for renting videos is P = 7.5 - 2.7Q, If purchasing an membership guarantees that you can rent as movies as you like for $ 0.14 per video. How many movies will you rent per year? 2.72 What is the most that you will pay the for the annual membership? $ 3.8
You have an income of $100,000. You can buy an electric car (which costs $60,000) or an internal- combustion car (which costs $30,000). The electric car has a lower mileage than an internal-combustion car: it costs you $1/km if you drive an electric car, but it costs you $2/km if you drive an internal- combustion car. You enjoy driving (measured in kilometers driven) and spending on other goods ( measured in dollars). Draw your budget line (in a diagram measuring all other goods on the vertical axis) if you buy an electric car. What is its slope and what is the economic meaning of its value?
On your way home from Super Groceries, your car breaks down. It is a hot summer day and you have nobody to call. With little time before the food spoils, you decide to prioritize what to carry on the walk home. You choose to take three items with you. Since you will need all five items today, you will replace the two abandoned items at the corner store near your house, Convenient Grocers. The table contains the prices you paid for each good at Super Groceries and the prices you will need to pay at Convenient Grocers to replace the goods. Which three items should you save? OOOOO vegetables fruits eggs ham milk Item milk eggs ham vegetables fruits Price at Super Groceries $3.75 $3.80 $2.95 $3.80 $2.50 Price at Convenient Grocers $4.25 $2.95 $5.25 $3.05 $3.80
On Sundays, people in Los Angeles consider a boat to Catalina Island to spend the day on the beach there. The utility that a person gets from visiting Catalina is 1-[n/10] – p , where n is the number of visitors on the island and p is the price of round-trip transportation (by boat). (Note that a visitor obtains more satisfaction if there are fewer other visitors on the island). The utility of staying home is zero. In equilibrium, how many people visit the island on a given Sunday? ( Your answer should depend on p.)
New York Giants star quarterback Eli Manning can sell 5 times more Giants memorabilia than any other employee of the team or stadium. Realizing this, Eli decides to stand behind a concession stand at MetLife Stadium and sell Giants merchandise during the team’s next home game. Why shouldn’t Eli do this, even though he’s better than anyone else at doing it?
The following five individuals have different utility functions over food (good x) and clothing (good y): 1) u₁(x, y) = 3x²y 2) u₂(x, y) = 2√x + y 3) Uz(x, y) = x0.6y0.4 4) u₁(x, y) = x² + y² 1 5) us(x, y) = x + 3y For each of these people: a) Compute their marginal utilities of good x, MUx = Ju(x,y) MU, = ду du(x,y) ax b) Check whether the property of "more is better" is satisfied for both goods? Explain. [Hint: Check whether marginal utilities are positive assuming positive amounts of good x and good y] ƏMUX əx and marginal utility of good y, c) Does the marginal utility of good x diminish, remain constant, or increase as each of the individuals buys more x? Explain. [Hint: There are 2 ways to do it: 1) visually check what happens to the expression of MUx when x increases (does it decrease, keep constant or decrease?); or 2) take the partial derivative of this marginal utility with respect to x, that is ƏMUx .aMUX ƏMUX If 0, the marginal utility of x is increasing in x] d) Does the…
If corn cost $.55 per pound and protein supplement cost $.12 per pound what is the maximum amount of corn purchase with a $2200 budget?

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