1) The local breakfast restaurant has a new offer: those who buy more than 10 sandwiches a month get a 50% discount on additional sandwiches. a. Jill is a regular at the shop. She loves this deal and says that she will buy more sandwiches than before. Draw her budget line with and without the offer; measure her sandwich consumption on the X and EOG on the Y axis. In the same graph show Jill's preferences. Derive her sandwich consumption before and after the deal. What indicates in your graph that she is better off with the promotion than without it? Explain (in one sentence).

1) The local breakfast restaurant has a new offer: those who buy more than 10 sandwiches a month get a 50% discount on additional sandwiches. a. Jill is a regular at the shop. She loves this deal and says that she will buy more sandwiches than before. Draw her budget line with and without the offer; measure her sandwich consumption on the X and EOG on the Y axis. In the same graph show Jill's preferences. Derive her sandwich consumption before and after the deal. What indicates in your graph that she is better off with the promotion than without it? Explain (in one sentence).

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter4: Utility Maximization And Choice

Section: Chapter Questions

Problem 4.4P

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