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- Jeremy is deeply in love with Jasmine. Jasmine lives where cell phone coverage is poor, so he can either call her on the land-line phone for five cents per minute or he can drive to see her, at a round—trip cost of 2 in gasoline money. He has a total of 10 per week to spend on staying in touch. To make his preferred choice, Jeremy uses a handy utilimometer that measures his total utility from personal visits and from phone minutes. Using the values in Table 6.6, figure out the points 011 Jeremys consumption choice budget constraint (it may be helpful to do a sketch) and identify his utility-maximizing point.Draw Maries budget constraint with pies on the horizontal axis and magazines on the vertical axis. What is the slope of me budget constraint?What are the assumptions of the consumer equilibrium??
- Briefly outline and explain some of factors that depend on line amount of a commodity a consumer os prepared to buya) Prove that when the consumer is in equilibrium the marginal utility that is placed on the goods he/she consumes is equal to its price. Explain how the consumer can restore equilibrium if market condition changes.Marcia spends her money on tee and biscuits and sugar, which she sees as perfect complements. She eats two biscuits with every cup of tea. A cup of tea costs $2 and one biscuit costs $0.2, and she spends $33.60 on tea and biscuits every week. Use a diagram measuring the number of biscuits on the horizontal axis to show her compensated variation and equivalent variation if the price of a biscuit decreases to $0.1. What can you say about the change in her consumer surplus?.
- Using the consumer choice theory, explain how an individual decides what combinations of different products to buy. Answer question step by step and use graph.Suppose one have a budget of $1000. The price of one unit of X is $20 and the price of one Unit of Y Is $10 If X provides one utility and Y gives one disutility, what is the equilibrium amount of X and Y for the consumer! Explain your answer with graph!If you have 10 dollars to spend, and the price of water is $1 oer bottle, the budget containt would show that the most water you could buy is?
- Dan consumes two goods: peanut butter andjelly sandwiches, which are an inferior good, andchicken salad sandwiches, which are a normalgood. He gets a raise at work. Will the ratio ofpeanut butter and jelly sandwiches to chickensalad sandwiches that he consumes increase ordecrease?How can else increase marginal utility and therefore the consumer demand curve?How does a consumer decide what combination of products to buy using the marginal utility concept? Explain. Please don,t copy from anywhere. Please answer step by step. if posssible use graph.
