Bessie, who can currently work as many hours as she wants at a wage of w, chooses to work 10 hours a day. Her boss decides to limit the number of hours that she can work to 8 hours per day. Show how her budget constraint and choice of hours change. Bessie's budget constraint L is illustrated in the figure to the right. For completing the following, assume the indifference curves satisfy the usual assumptions. 1.) Use the 3-point curved line drawing tool to draw an indifference curve for Bessie when she can work as many hours as she wants. Label this curve 1¹ 2.) Use the 3-point curved line drawing tool to draw an indifference curve representing Bessie's utility when she is restricted to work 8 hours per day. Label this curve R₁ Carefully follow the instructions above, and only draw the required objects. Y, Goods per day (-1,19.3) **********..... Time constraint 10 8 L, Leisure hours per day

Bessie, who can currently work as many hours as she wants at a wage of w, chooses to work 10 hours a day. Her boss decides to limit the number of hours that she can work to 8 hours per day. Show how her budget constraint and choice of hours change. Bessie's budget constraint L is illustrated in the figure to the right. For completing the following, assume the indifference curves satisfy the usual assumptions. 1.) Use the 3-point curved line drawing tool to draw an indifference curve for Bessie when she can work as many hours as she wants. Label this curve 1¹ 2.) Use the 3-point curved line drawing tool to draw an indifference curve representing Bessie's utility when she is restricted to work 8 hours per day. Label this curve R₁ Carefully follow the instructions above, and only draw the required objects. Y, Goods per day (-1,19.3) **********..... Time constraint 10 8 L, Leisure hours per day

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter21: The Theory Of Consumer Choice

Section: Chapter Questions

Problem 9PA

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