6. Given the savings function S = (3Y2 +2Y)/ ( Y-1) a) Write the consumption function. b) Find the equilibrium level of income, if the consumption is 100. Please answer both subparts. I will really upvote
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6. Given the savings function S = (3Y2 +2Y)/ ( Y-1)
a) Write the consumption function.
b) Find the equilibrium level of income, if the consumption is 100.
Please answer both subparts.
I will really upvote
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- Rajiv is buying pizza and salad for a company lunch. Suppose that a slice of pizza costs $2.00, and a bowl of salad costs $4.00. Let E be the amount in dollars that Rajiv spends on pizza and salad. If Rajiv buys P slices of pizza and S bowls of salad, then the total amount of money he spends (E) can be represented by the equation Now rearrange the equation you wrote above so that S is written in terms of E and P. The quantity of salad he buys can be represented by the equation Suppose Rajiv has $32.00 to spend on pizza and salad; that is, E = $32.00. Complete the following table with the values of P or S that make the equation true. Hint: To complete the first row, determine the number of salad bowls Rajiv can purchase with $32.00, when the number of pizza slices he purchases is 0. Budget Pizza Salad (Dollars) (Slices) (Bowls) 32.00 32.00 8 32.00 Use the black line (plus symbols) to plot the line illustrating the combinations of pizza and salad that Rajiv can purchase with a budget of…Think about a utility function U(x,y) =xy, the budget constraint is px*x+py*y=m. a. Please derive the Marshallian demand functions. b. Please derive the indirect utility function. c. Please derive the expenditure function. If originally m = 8, px=1, py=4. d. What is his optimal consumption? e. What is his maximum utility level?An equation that represents a utility-maximizing pattern of consumption of two goods, A and B, is ______________________.
- Tim is buying pizza and salad for a company lunch. Suppose that a slice of pizza costs $4.00, and a bowl of salad costs $5.00. Let ♬ be the amount in dollars that Tim spends on pizza and salad. If Tim buys P slices of pizza and S bowls of salad, then the total amount of money he spends (B) can be represented by the equation Now rearrange the equation you wrote above so that S is written in terms of E and P. The quantity of salad he buys can be represented by the equation Suppose Tim has $40.00 to spend on pizza and salad; that is, E = $40.00. Complete the following table with the values of P or S that make the equation true. Hint: To complete the first row, determine the number of salad bowls Tim can purchase with $40.00, when the number of pizza slices he purchases is 0. Budget Pizza (Dollars) (Slices) 40.00 0 40.00 5 40.00 Use the black line (plus symbols) to plot the line illustrating the combinations of pizza and salad that Tim can purchase with a budget of $40.00. SALAD (Bowis) 14…Use the black line (plus symbols) to plot the line illustrating the combinations of salad and pizza that Andrew can purchase with a budget of $30.00. PIZZA (Slices) 14 12 10 00 4 2 O to 0 2 4 8 8 SALAD (Bowls) 10 12 14 Initial Budget New Budget ? Now suppose Andrew's income is cut in half: That is, he has 50% less money to spend than he did before. On the previous graph, use the blue line (circle symbols) to plot Andrew's new budget constraint. Which of the following statements best summarizes the pattern of causality captured by the graph above? Check all that apply. The relationship between S and P is not a causal relationship. A change in E causes a shift of the budget constraint. A change in S causes a change in P. A change in P causes a change in S.Quantity of Potato Chips E Quantity of Diet Coke Refer to the figure. What point does NOT represent a possible consumption option? a) point A b) point B c) point D d) point E
- Suppose Maria would spend $1500 per year on travel, even if her annual income were zero. As her income rises, she would spend 30% of each additional dollar of income on travel. a. Write a mathematical equation that describes the functional relation between Maria travel spending (T) and her income (Y). b. Draw a graph from the equation developed in part a above.Suppose you consume three goods, and you have the following expenditure function: 0.5 E(Pa, Py, Pz, U)=p5 (Py + P₂) 0.5U Which of the following are true? (a) x and y are net complements (b) x and y are net substitutes (c) y and z are net complements (d) y and z are net substitutes (e) A and C (f) B and C (g) B and DEconomics Michelle is a saver, and consumption in period 1 is a normal good. If there is an increase in the interest rate: Group of answer choices Both the substitution and income effects will decrease consumption in period 1. Cannot be determined without additional information. The substitution effect will increase consumption in period 1, whereas the income effect will decrease it. Both the substitution and income effects will increase consumption in period 1. The substitution effect will decrease consumption in period 1, whereas the income effect will increase it.
- Intertemporal budget constraint. Budget line 1: Y1 = $900. Y2 = $600. The interest rate is 12 percent, both for borrowing and saving. Utility = C15C27 Draw the budget line, with solved numbers. Solve the optimal consumption levels to choose in time 1 and time 2.If a consumer has spent all her income on two goods, a and b, and we fins that (MUA) / (MUB) = PA/PB, what can we say about the consumerA 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 curve b.) The curvature of the indifference curve c.) Whether the marginal utility of money is constant, rising, or falling as money income increases. d.) the income elasticity of demand for Y e.) The price elasticity of demand for X.