production of $1.00 worth of food requires $0.30 worth of food a $0.10 worth of housing, and the production of $1.00 worth of housing requires $0.20 worth of food and $0.60 worth of housing Construct a consumption matrix for this economy. ? ?
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- 12. Kinked budget constraints Suppose that your family has just decided to adopt a parakeet named Daisy. You have a monthly budget of $50 that you can choose to spend on either bird seed or other consumption goods. Assume the price of a bag of bird seed is $5 for the first 4 bags, but then it drops to only $3 per bag for each additional bag. All other consumption goods will be treated as a composite good, so you can think of this as simply the cash left over to spend on other items after buying bird seed. On the following graph, use the blue points (circle symbol) to graph your family's budget constraint. Remember to plot from left to right. Line segments will automatically connect the points. OTHER CONSUMPTION (Amount per month) 50 45 40 35 30 25 20 15 10 5 0 0 2 4 6 8 10 12 14 16 BIRD SEED BAGS (Bags per month) 18 20 Budget ConstraintWhich of the following statements is correct? a. In a consumers’ utility maximization problems over current and future consumption goods, a higher rate of return r produces substitution and income effects that cause a decrease in quantity demanded of future consumption goods. b. In a consumers’ utility maximization problems over current and future consumption goods, a higher rate of return r produces substitution and income effects that cause an increase in quantity demanded of current consumption goods. c. In a consumers’ utility maximization problems over current and future consumption goods, a higher rate of return r produces substitution effects that favor more saving and income effects that favor less. d. All of the above.Suppose the graph below shows Gilligan's daily production possibilities curve for coconuts and fish. If Gilligan gathers 3 Ibs of coconuts each day, then what's the maximum amount of fish he can catch in a day? 9. 8. 6. 4 1 0 1 2 3 4 5 6 Fish (Ibs/day) 04 Ibs of fish 4.5 lbs of fish 6 lbs of fish Tenannat ha datarminat Coconuts (Ibs/day)
- Question 3 Person 1 can allocate her 8-hour day between the production of two goods: A and B. Each hour devoted to Good B yields 2 units whereas each hour devoted to Good A produces 4 units. (a) State whether 9 units of Good B and 12 units of Good A are attainable, unattainable, efficient or inefficient. [State all that applies.] Select one or more: attainable unattainable efficient inefficientAMoving to the next question prevents changes to this answer. Question 3 of Question 3 1 points Save Answ The branch of economics that analyses the market behaviour of individual consumers and firms in an attemp to understand the decision-making process of firms and households. a)Gross Domestic Product O b)Micro Economics c)Macro Economics d)Logistics e)Gross National Product O0000on your computer. Save 2. I . 3 4. 5. . 3) Allison is planning to make a sandbox for her children. She has determined the quantity of sand she will need and identified these two options for getting the sand to her house: a. Allison can have all the sand delivered to her yard in one dump truck for $350. b. Allison can make four trips to the garden center with her pickup truck and haul it herself. It will cost her $50 per load for the sand, plus $30 in fuel and truck wear per load. She estimates it will take one hour to haul and unload each load. What is the full cost of each method? Which option is cheaper? How is opportunity cost relevant? DFocu
- (Figure: Crumpets and Tea II) If the economy is at point 4, the input mix is: Mateo's crumpets 4 3 2 Lucia's tea ->> 6 5 2 7 6 0 5 1 20 1 UTUB 1 2 3 4 Lucia's crumpets 0 5 6 7 C Mateo's tea not Pareto-efficient; a movement to point C or point D would be a Pareto improvement. not Pareto-efficient; only a movement to point D would be a Pareto improvement. O not Pareto-efficient, a movement to point C or point D would be Pareto-inefficient. Pareto-efficient; a movement to any other point would be Pareto-inefficient.Question 3 Person 1 can allocate her 8-hour day between the production of two goods: A and B. Each hour devoted to Good B yields 2 units whereas each hour devoted to Good A produces 4 units. (a) State whether 9 units of Good B and 12 units of Good A are attainable, unattainable, efficient or inefficient. [State all that applies.] Select one or more: attainable unattainable efficient inefficientbabb (2) (3) (1) Figure 2-6 ХО (4) Refer to Figure 2-6. Which graph depicts the result of a technological improvement in the production of both goods X and Y? a. (3) b. (1) 0 c (4) O d. (2)
- You Answered Correct Answer Question 19 Note: The basic scenario is the same as in Question 18, but input numbers are different. Suppose that farmer Maria has a budget of $4,380 that she plans to spend entirely on diesel fuel for her tractor, and fertilizer for her crops. Maria's budget line represents all the different quantities of fuel and fertilizer that she can buy with her $4,380. It can be graphed with fuel on the vertical axis and fertilizer de the horizontal axis. Diesel sells for $2.55/gallon; fertilizer goes for $2.45/pound. If she buys 1,036 gallons of diesel for the tractor, how many pounds of fertilizer will she purchase? (round to the nearest pound) Hint: Figure out what the budget equation looks like, in terms of prices and quantities of both goods, and solve it for the quantity of fertilizer. 710 margin of error +/- 25. A consumer buys only two goods, X and Y. No other goods exist and there is no possibility of saving. The marginal utility of X is independent of the quantity of Y consumed, and the marginal utility of Y is independent of the quantity of X consumed. MUX is constant no matter how he consumes, but MUY falls as consumption increases. In the initial equilibrium he consumes one of each good. How much can you infer about the following:a.) The slope of the indifference curveb.) The curvature of the indifference curvec.) Whether the marginal utility of money is constant, rising, or falling as money income increases.d.) the income elasticity of demand for Ye.) The price elasticity of demand for X.4. The following data pertain to products A and B, both of which are purchased by Jay. Initially, the prices of the products and quantities consumed are: PA = $10; QA = 3; PB = $10; QB = 7 Jay has $100 to spend. After a reduction in price of B, the prices and quantities consumed are: PA = $10; QA = 2:5; PB = $5; QB = 15 Assume that Jay maximizes utility under both price conditions above. Also, note that if after the price reduction enough income were taken away from Jay to put him back on the original indifference curve, he would consume this combination of A and B: QA 1:5; QB = 9 Determine the change in consumption of good B due to the (1) the substitution effect and (2) the income effect using Hicks decomposition.