Principles of Economics (12th Edition)
12th Edition
ISBN: 9780134078779
Author: Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher: PEARSON
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Question
Chapter 6, Problem 1.2P
(a)
To determine
The budget constraints
(b)
To determine
Does the choice fits with in the budget constrain.
(c)
To determine
The budget constraints
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Students have asked these similar questions
5. Marie has a weekly budget of $42, which she likes to spend on magazines and pies.
a. If the price of a magazine is $7 each, what is the maximum number of magazines she
could buy in a week?
maximum of magazine = 6 magazines a week
b. If the price of a pie is $21, what is the maximum number of pies she could buy in a
week?
maximum of pies = 2 Pies a week
c. What is Marie's opportunity cost of purchasing a pie (in terms of magazines)?
d. At the start of the week, Marie decides to buy a pie. Does this imply that the utility
she receives from this pie is greater than or less than her opportunity cost of
purchasing the pie?
e. Marie is thinking about purchasing a second pie. Do we expect the marginal utility
she receives from the second pie to be greater than, less than, or equal to the
marginal utility she receives from the first pie? Explain your answer.
Question 10
Basil is a broke college student who consumes only coffee and pizza. No one is really sure how he can
survive on those two goods alone, but somehow he does. Coffee is $2 per cup, and pizza is $5 per pizza.
Basil's weekly budget constraint is shown below.
On the graph below show how his budget constraint would change if Basil gets an additional $10 per week
from his grandmother.
Coffee (cups per week)
15
14
13
3 210 000 654
120
w
2
-N
Budget Constraint
0
01 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Pizza (number per week)
Chapter 6 Solutions
Principles of Economics (12th Edition)
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Similar questions
- 16arrow_forwardHiro's latte and paperback book budget is $20 a week. The price of a latte is $2 and the price of a paperback book is $5. Choose the statement that is correct. O A. When Hiro spends all his budget on paperback books, he must buy fewer than 4 paperback books a week. O B. When Hiro buys 10 lattes a week he cannot afford to buy a paperback book. O C. Hiro cannot afford to buy 5 lattes and 2 paperback books a week. O D. When Hiro buys 10 lattes, he can afford to buy 2 paperback books. Draw Hiro's budget line and label it. >>> Plot the quantity of paperback books on the x-axis. 11- 10- 9- 8- 7- 6- 5- 4- 3+ 2- 1- 0- Quantity (lattes per week) 0 2 3 4 5 6 7 8 9 10 11 Quantity (paperback books per week) >>> Draw only the objects specified in the question. 1arrow_forward8. Problems and Applications Q8 Consider your decision about how many hours to work. The following graph shows your budget constraint assuming that you pay no taxes on your income. On the following graph, show the effect of a 15 percent income tax on your budget constraint. Deborah is awake for 100 hours per week. Use the green line (triangle symbol) to draw Deborah's budget constraint if she earns $12 per hour. Then use the blue line (circle symbol) to draw her budget constraint if she earns $16 per hour. Finally, use the purple line (diamond symbol) to draw her budget constraint if she earns $20 per hour.arrow_forward
- 12. Suppose a cup of coffee at the campus coffee shop is $2.00 and a cup of hot tea is $2.50. Suppose a student's beverage budget is $20 per week. What is the most cups of tea the student could buy? a. b. 10 16 d. 20 c.arrow_forwardUse this information to answer the following 4 questions: Marie has a weekly budget of $24,which she likes to spend on magazines and pies.24. If the price of a magazine is $4 each, what is the maximum number of magazines she couldbuy in a week?25. If the price of a pie is $12, what is the maximum number of pies she could buy in a week?26. Draw Marie’s budget constraint with pies on the horizontal axis and magazines on thevertical axis. What is the slope of the budget constraint?27. What is Marie’s opportunity cost of purchasing a pie? I need help with number 26 and 27.arrow_forwardSuppose you have a budget of 30 to spend on two goods: pizzas and burgers. Each pizza is $5 while each burger is $10. Suppose you already purchased 6 pizzas. What is the maximum number of burgers that you can buy with the remaining funds in your budget?arrow_forward
- The nearby graph shows Claudia's budget constraint for purchases of shoes and purses. Claudia's monthly budget for shoes and purses is $100. Claudia's parents have told her that she has too many shoes and is not allowed to buy more than 1 pair a month. If she buys 1 pair of shoes and 1 purse, she will have $______left each month. Number of 4.5 purses 4.0 3.5 3.0 2.5 2.Q 1.5 1.0 0.5 $50 $10 O $75 $25 0 0.2 0.4 0.6 1.0 1.2 Number of pairs of shoes 0.8arrow_forwardQu 2 narrow_forwardconsider your decision about how many hours to work. a. draw your budget assuming that you pay no takes on your income. on the diagram, draw another budget constraint assuming that you pay 15% tax. b. show how the tax might lead to more hours of hours,fewer hours or the same number of hours. explain.arrow_forward
- Graph is necessaryarrow_forwardi need the answer quicklyarrow_forwardWendy drinks 10 sugary drinks and 4 smoothies a week. Smoothies are $5 each and sugary drinks were $2 each. This week, things are different: the government has slapped a tax on sugary drinks and their price has doubled to $4. But it's not all bad news for Wendy. The government has also revised the income tax, so Wendy's drinks budget has increased. She can now just afford to buy her usual 10 sugary drinks and 4 smoothies a week.arrow_forward
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