.Explain why convex preferences means that “averages are preferred to extremes

Q: Suppose that consumer has the following utility function: U(X,Y) = XY and Px = 1, Py = 4 and I =…

A: Here in the question, we have to find out the magnitude of the substitution effect. Income = 720 Px…

Q: 5. Tom is willing to forego two gallons of milk in order to try his first container of rice pudding.…

A: As Tom is willing to forego 2 gallons of milk for his first container of rice pudding, his MRS in…

Q: 25. Imagine a consumer who spends her income (y) entirely on apples and ba- nanas. Apples are…

A: Utility maximization occurs when marginal rate of substitution is equal to slope of the budget…

Q: Suppose there are two goods, that the prices are given, and that there is a consumer worth a certain…

A: Normal good – a good in which an increase in income raises its sales.

Q: 7.A college football coach says that given any two linemen A and B, he always prefers the one who is…

A: Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: 1. Is it impossible for two indifference curves to intersect one another? why? 2. What does it mean…

A: We will answer the first question only. Please resubmit the other question separately in case you…

Q: Explain why convex preferences means that “averages are preferred to extremes.”

A: The convex preferences in the economy indicate that the consumers prefer the averages rather than…

Q: Question 7: For each of the following price-income scenarios, sketch the con- sumer's budget lines…

A: Budget line: 1) BL1: 70=5q1+10q22) BL2: 70=10q1+10q23) BL3: 140 =10q1+10q2

Q: Sarge's utility function is U(X1,X2)= X1*X2. If his marginal rate of substitution (MRS) is 3 and he…

A: MRS = Marginal utility from good x1 / Marginal utility from good x2

Q: 4. We learned that the slope of the indifference curve is called the marginal rate of substitution…

A: The answer is as follows:-

Q: 1. Given the indifference curve above, which of the Points a, b, c, d, or e. Yields the highest…

A: Indifference curve refers to the combination of 2 goods that gives the same satisfaction to the…

Q: 2. Suppose John's utility function is UX,Y) = 4/XY , where X is consumption of beer and Y is…

A: Marginal rate of substitution refers to the ratio of marginal utility of good X and marginal utility…

Q: If the preferences are concave, will the consumer ever consume both of the goods together?

A: When dealing with consumer preferences, the shape of the indifference curve helps to understand the…

Q: 11) An individual consumes only two goods, X and Y. Which of the following expressions represents…

A: A consumer becomes indifferent when two items are combined because they both provide the same level…

Q: 1. Assume that when the price of X decreases the consumption of Y remains the same. Draw the…

A: Answer -

Q: 29. Which one is not a assumption of the theory of demand based on analysis of indifference curves?…

A: Indifference Curve Analysis Assumptions:- (1) In order to achieve maximum satisfaction, the customer…

Q: 11. Suppose an individual has a daily income of Rs. 1,500 and spends it to consume commodities X and…

A: Income of the individual = 1500 Price of X = 75 Price of Y = 50

Q: Suppose Mika has budget of $600 for only two goods, x and y. The price of a Good X is $10 and the…

A: Since you posted a question with multiple sub-parts, we will solve the first three sub-parts for…

Q: 13) An indifference curve is related to which of the following? A) Choices and preferences of…

A: The theory of utility maximization says that every individual focuses on utility maximization. This…

Q: Compare the following two pairs of goods:• Coke and Pepsi• Skis and ski bindingsa. In which case are…

A: Substitute goods are defined as when change in price of one good leads to increase the demand of…

Q: The budget constraint line by itself tells us preferences and indifference. True O False

A: Budget constraint: - it is a graphical representation of different bundles of goods that a consumer…

Q: Referring to the graph below (Figure 2) showing a consumer's initial budget line (labeled BO and new…

A: Given graph

Q: Following up on the preceding question, instead of assuming Ming has "standard-looking indifference…

A: A complementary good is a product or service that enhances the value of another product or service.…

Q: Question 7: Logan has preferences over olives (x₁) and ice creams (x₂). He prefers to eat them…

A: Note:- Since we can only answer up to three subparts, we'll answer the first three. Please repost…

Q: 1) a) Given the following typical utility curves determine whether they have convex indifference…

A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…

Q: more Y and less X the same amount of X and Y more X and less Y in order to maximize​ his/her…

A: The utility function of the consumer is U=100X0.25y0.25 Where X and y are the amounts of the two…

Q: Calculating the marginal rate of substitution (MRS). Crystal enjoys eating muffins and scones. The…

A: At point A; U(X,Y)=U(10,70)  At point B; U(X,Y)= U(15,45)  MRS=Change in good YChange in good X…

Q: 29. Which one is not a assumption of the theory of demand based on analysis of indifference curves?…

A: Indifference Curve shows the different combinations of goods that gives consumer the same level of…

Q: Sarge's utility function is U(X1,X2)= X1*X2. If his marginal rate of substitution (MRS) is 3 and he…

A: An utility function represents the preferences of a set of goods and services that give the consumer…

Q: Suppose Mika has budget of $600 for only two goods, x and y. The price of a Good X is $10 and the…

A: Hi! thanks for the question but as per the guidelines, we answer up to three subparts at one time.…

Q: Tristan has preferences for computers (C), and robots (R). Computers costs $750 a unit and robots…

A: The consumer tends to maximize utility where the slope of indifference curve is equal to the slope…

Q: C. Given the following indifference curves, the budget and the prices of goods X and Y, at what…

A:

Q: 4. We learned that the slope of the indifference curve is called the marginal rate of substitution…

A: A indifference curve is a graphical portrayal of a joined items that gives comparative sort of…

Q: X a e b d

A: Here, the given figure provide information about the budget line and three indifference curves.

Q: 3.7 (0) Joan likes chocolate cake and ice cream, but after 10 slices of cake, she gets tired of…

A: Answer - Part (0) Answer -

Q: C 12 Good X Good X Good X This picture shows three different indifference curve maps: A, B and C.…

A: The answer is - option 3 - B

Q: 3) Diminishing marginal rate of substitution can be seen when indifference curves A) become flatter…

A: The curve that depicts combinations of goods that could provide the consumer with an equal level of…

Q: 10. Assume an individual's preferences are represented by the following indifference map and he has…

A: Income = 400  Price of Good1 = $20 Price of Good 2 Originally = $10 Price of Good 2 Changes to = $16…

Q: 15. Which of the following functional forms for utility suggests the greatest substitution effect…

A: The utility function would result in the function of the quantities demanded by the consumer at the…

Q: QUESTION 7 Select which of the following statements is true if two goods are perfect complements: O…

A: complementary goods are negatively related to each other.

Q: 4- An indifference curve connects points on a graph representing different quantities of two goods,…

A: Microeconomics studies the economic behavior of the individual units such as a buyer, a seller, a…