Suppose Jack has $400 in nominal income. The price per unit of DVDs is $20. Accordingly, what is Jack's real income in terms of DVDs? O a. O b. O c. Od. between 0 and 15 between 15 and 30 between 30 and 45 between 45 and 60 e. greater than 60
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- Q-4 Suppose that Kaleed’s income 1800 RO. And he purchased 30 units of goods y that cost 30 RO per unit. Calculate how many units Kaleed can buy of product X when it costs 20 RO.Assume that John has RO 21 to spend on Energy drink and Protein bars each month and that both goods must be purchased whole (no fractional units). Energy drink (X) cost RO 3 and Protein bars (Y) cost RO 2 each. John’s preferences for movies and books are summarized by the following information: No. per Month Energy drink No. per Month Protein bars TU MU MU/Px TU MU MU/Py 1 84 1 36 2 156 2 66 3 216 3 90 4 264 4 108 5 300 5 120 6 324 6 126 7 336 7 126 Fill in the figures for marginal utility of X and marginal utility of Y per dollar for both movies and books. Are these preferences consistent with the law of diminishing marginal utility? Explain briefly. Given the budget of RO 21, what quantity of Energy drink (X) and what quantity of Protein bars (Y) will maximize John’s…8. Suppose both the consumption good and leisure are normal goods any graphs what will happen to the household's choice if there is (a) an increase in dividend income ; (b) an increase in wage w. without bois 1-on0 9TI laicuro in inferior Rengat
- 12. Fill in the blankConsider the following graph, which shows the relationship between an individual's income and the number of times he or she eats out each month. QUANTITY (Dinners out per month) 20 10 16 14 12 O 7 INCOME (Thousands of dollars per month) 10 Brian ? Hint: When answering the following, be sure to specify the appropriate units. The blue point already shown on the graph shows the data for Crystal. According to the graph, Crystal's income is has Suppose Crystal's friend Brian has an income of $2,000 per month and has 4 dinners out per month. $8,000 $8,000 per month $16 per month $16 and sheYou categorize spending for this month into four categories: Rent, Food, Fun, and Other. The percents spent in each category are pictured here. MONTHLY SPENDING Chart Ar Fun 8% Food 31% If you spent a total of $3400 this month, how much did is spent on rent? (Enter your answer as a whole number. Do not include the dollar sign.) Other 23% Rent 38%
- 7. Consider a generic consumption/leisure choice. How will the follow ing events/policies affect either the consumer's choice of hours worked and labor supply, if at all? Be specific as possible about income and substitution effects and if there are multiple cases, consider them all (a) A raise in the wage rate (b) A labor income tax on all income. (c) A labor income tax on all labor income beyond the first 20 hours.7.If pizza is a normal good, then which of the following could be the value of incomeelasticity of demand?Assume that Sara has $800 per month to divide between playing golf and playing paint ball . Assume Golf costs $40 and paintball costs $80 . Suppose Sara plays golf eight times per month and plays paintball six times per month . a. Draw Sara’s budget constraintb. Assume Sara has new expenses and can spend $320 only this month. Draw the new budget constraintc. As a result of a decrease in income Sara decides to play 11 rounds of golf and two games of paintball . what kind of a good is paintball ? what kind of a good is golf?d. Assume Sara has $400, the price of paintball is still $40 , but the price of Golf doubles , draw the new budget constraint
- A sakai.plu.edu Netflix YouTube Dashboard Quick Links 160 170 18C 210 22 O 23 C Consider the change in the price of a book depicted in the diagram. The original budget line is Bc. The new budget line is Bd. As a result of this price change, the 260 270 28C 32 0 38 substitution effect can be represented by a movement from 31C 33C 36 37 O D. Books (per month) OA. point A to point E. OB. point A to point G. OC. point F to point G. OD. point A to point F. Reset Selection Movies (per month)Suppose the linear demand curve for shirtsslopes downward and that consumers buy 500 shirts per yearwhen the price is $30 and 1,000 shirts per year when the priceis $25.a. Compared to the prices of $30 and $25, what can you sayabout the marginal valuation that consumers place on the300th shirt, the 700th shirt, and the 1,200th shirt they mightbuy each year?b. With diminishing marginal utility, are consumers derivingany consumer surplus if the price is $25 per shirt? Explain.c. Use a market demand curve to illustrate the change in consumersurplus if the price drops from $30 to $25.. Suppose that initially, bread is $2 per loaf,and cake is $2 per slice. Marie Antoinettehas $18 to spend on these items each week.At this income and those prices, Marie consumes 5 loaves of bread and 4 slices of cake.Then, the price of bread DECREASES to$1 per loaf. (The price of cake is still $2.)IF Marie’s budget had also fallen to $13so that she could still just afford her original bundle, she WOULD choose to spendthose $13 on 7 loaves of bread and 3 slicesof cake.But since Marie still has her original $18budget, she actually chooses to buy 4loaves of bread and 7 slices of cake afterthe price change.When the price of bread fell from $2 to $1,what was the substitution effect on Marie’sdemand for bread?
