5. Suppose you won $15 on a lotto ticket at the Hy-vee and decided to spend all the winnings on Cokes and bags of peanuts. The price of Candy bars is $.75 and the price of peanuts is $1.50. Complete the table showing the alternative combinations of the two products that are available. (Instructions: enter only whole numbers in the table below.) Consumption Alternatives Goods Price A B C D F Candy bars $0.75 12 16 20 Bags of peanuts $1.50 10 b. Plot the data in your table as a budget line in a graph. What is the slope of the budget→ - 0.5 line? What is the opportunity cost of one more Candy bar? Of one more bag of peanuts? Slope of the budget line (show work with formulas!): Bags of peanuts A 1.Using rise/run ( vertical changes + horizontal changes) 10 8 2.Using price ratio ( P(candybar) +P(peanut)) = 4 Opportunity cost of one more candy bar: Opportunity cost of one more bags of peanuts: 10 15 20 Candy hare

5. Suppose you won $15 on a lotto ticket at the Hy-vee and decided to spend all the winnings on Cokes and bags of peanuts. The price of Candy bars is $.75 and the price of peanuts is $1.50. Complete the table showing the alternative combinations of the two products that are available. (Instructions: enter only whole numbers in the table below.) Consumption Alternatives Goods Price A B C D F Candy bars $0.75 12 16 20 Bags of peanuts $1.50 10 b. Plot the data in your table as a budget line in a graph. What is the slope of the budget→ - 0.5 line? What is the opportunity cost of one more Candy bar? Of one more bag of peanuts? Slope of the budget line (show work with formulas!): Bags of peanuts A 1.Using rise/run ( vertical changes + horizontal changes) 10 8 2.Using price ratio ( P(candybar) +P(peanut)) = 4 Opportunity cost of one more candy bar: Opportunity cost of one more bags of peanuts: 10 15 20 Candy hare

Economics For Today

10th Edition

ISBN:9781337613040

Author:Tucker

Publisher:Tucker

Chapter2: Productions Possibilities, Opportunity Costs, And Economic Growth

Section: Chapter Questions

Problem 2SQ

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Suppose you won $15 on a lotto ticket at the local 7-Eleven and decided to spend all the winnings on candy bars and bags of peanuts. The price of candy bars is $.75 and the price of peanuts is $1.50. Suppose that you had won $30 on your ticket, not $15. Show the $30 budget line in your diagram. Why would this budget line be preferable to the old one?
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