In the diagram to the right, we have five different combinations of movies and books. Combination A represents 2 movies and 3 books. Combination C represents more books (7) and the same number of movies (2). Points B, E, and F are other combinations with more movies, more books, or more of both. When compared to combination A, combination B satisfaction to the consumer. provides When compared to combination F, combination B provides satisfaction to the consumer. When compared to combination A, combination F provides satisfaction to the consumer. These conclusions are based on what assumption about preferences? Books 10- 9- 8- 7- 6- 4- 3- 2- 1- 0 C A 1 2 3 E 4 5 Movies F B 6 7 8 9
Q: . The seafood restaurant you manage has daily specials. You have observed that the fresh salmon is…
A: Given The price elasticity of demand for salmon is -1.2 The required increase in the sale of salmon…
Q: Suppose a monopolist M sells two products, X and Y. • Demand for X is qX = 1000 − pX − 1/2pY •…
A: Information given in question states:- Demand for X is qX = 1000 − pX − 1/2pY Demand for Y is qY =…
Q: In 2012 final sales equal $350 billion and the change in business inventories is -$60 billion. GDP…
A: GDP measures the value of final goods and services that are produced within the borders of the…
Q: In connection with surfacing a new highway, a contractor has a choice of two sites on which to set…
A: Fixed costs are those that remain constant regardless of changes in production levels. Contrarily,…
Q: 1. High concentrations of sulfur emitted by coal fired electricity plants are toxic for humans. They…
A: Note:- Dear learner you have posted a questions with multiple sub parts, here we have solved only…
Q: suppose > has an utilitiy represtantion prove transtive
A: Given : ≥ has utility reprsentation In other words, lets consider three bundles of good x and y i.e.…
Q: The demand and supply schedules in this table list the quantity supplied and quantity demanded of…
A: Demand refers to the quantity that a consumer wishes to buy at a given price in a given period of…
Q: #3. Fiscal policy can affect the rental cost of capital. true or false.?
A: Fiscal policy is the use of government spending and taxation by the government to influence the…
Q: What advantage does economics have over the other social sciences that study human behavior? What…
A: Economics The allocation of scarce resources by individuals and organizations for production,…
Q: Define a corner solution in the labour market and discuss fully with aid of well labelled graphs how…
A: Labor Market The supply and demand for labor, wherein employees give the supply and employers…
Q: K The cost of a nation's market basket in the base year is $1,200, and the current year's price…
A: Price index measures the overall price level of market basket of goods and services.
Q: (2) Show graphically and explain intuitively why price elasticity of demand varies along a linear…
A: The elasticity of demand can be calculated by using the below formula in the case of linear or…
Q: Consider the “production” of food, which uses various types of inputs: “labor” (e.g., cooks);…
A:
Q: The relationship between fiscal and monetary policies, referring to the nature of the financial…
A: The government uses fiscal policies as tools to ensure a healthy market by preventing recession and…
Q: For each of the following utility functions, find the Marshallian demand function, the indirect…
A: The factors of spending and commodity price are used to generate the indirect utility function from…
Q: A manufacturer has a steady annual demand for 11,520 cases of sugar. It costs $5 to store 1 case for…
A: Annual demand = 11,520 cases of sugar costs $5 to store 1 case for 1 year $ 32 set up cost to…
Q: 1. The broader economic factors is also called micro-economics. Group of answer choices True…
A: Since you have provided multiple questions, we will solve the first question for you. If you want…
Q: Why do presidents typically reappoint Chairs of the Federal Reserve Board even when they were…
A: The country's central banking system, which is in charge of monetary policy by controlling the…
Q: An economy is productively efficient whenever it is producing the maximum output with given…
A: According to microeconomics theory, the production possibility frontier is the curve that shows the…
Q: Question 6 Recall that the MRS at a consumption bundle (x₁, x2) is defined as negative the slope of…
A: MRS is the marginal rate of substitution which is the rate at which one good is substituted for…
Q: QUESTION 7 The output gap is increasing over time because actual GDP is greater than potential GDP…
A: The output gap is an economic proportion of the distinction between the actual result of an economy…
Q: Examples of deflators are the and deflator personal consumption expenditure; gross domestic product…
A: Deflator is a value that is used to measure inflation through changes in current prices or wages…
Q: Three stocks have share prices of $20, $10, and $30 with total market values of $400 million, $350…
A: Price weighted index is the average of prices of stocks. The price of stock has strong influence on…
Q: Question 2: Suppose Tom has following perfect substitute preference. Sketch Ollowing curves (good 1…
A: U(q1 , q2 ) = q1 + 2q2 Above utility function represents perfect substitute preferences in which…
Q: Using an appropriate diagram(s), explain the concept of direct and indirect finance. As a student…
A: Dear learner you have posted multiple questions, as per our policy we have solved only first…
Q: International Business Why do firms conduct international business? Require about 200 words. DO NOT…
A: There are several reasons why firms conduct international business but the main reason is to…
Q: produce a discussion paper for a group exercise with other candidates which analyses the…
A: The cultural and regulatory diversity of international markets can present both challenges and…
Q: Consider an economy in which the amount of investment is equal to the amount of saving (i.e., the…
A: γ: the fraction of output of income that is invested/saved The production function is y=Ak^α …………….…
Q: How much do you have to deposit now with a second deposit in the amount of $700 at the end of the…
A: There are two cash flow diagrams in this question. First cash flow: year 0 deposit = A0 and year 1…
Q: (This question refers to the MRU video 'The Supply Curve Shifts'.) What effect would a $20 tax have…
A:
Q: The government leaders of Nestua believe that corporations in Nestua are not paying their fair share…
A: Answer to the question is as follows:
Q: 2) Given the following supply and demand functions: Supply : Q = 15.90 + 0.72 P G + 0.05 Po Demand :…
A: The equilibrium occurs where the demand and supply are equal. The shortage will occur if supply…
Q: Discuss the major shortcomings of the Basle I accord.
A: Basel I was the first global agreement on adequate amount of bank capital. Criticisms include that…
Q: The GDP deflator is...
A: GDP is a monetary proportion of the market value of the relative multitude of conclusive goods and…
Q: b. Use the figure below to explain the impacts of a earning that is below the equilibrium earnings…
A: Equilibrium refers to the point where demand is equal to the supply
Q: The importance of an economic model is that it allows us to: a. build an accurate mathematical model…
A: Economic model makes it easy to understand the complex economic problems and issues. It simplifies…
Q: The minimum wage in Arizona is $10.50. This is higher than the federal minimum wage of $7.25. Which…
A: Macroeconomics refers to the branch of economics that deals with the economy as a whole. For…
Q: Problem 3. (SW 7.10) Show that the two alternative formulas below for the homoscedasticity-only…
A: Homoscedasticity in regression refers to the constant variance of the error term. It is one of the…
Q: Which of the following is a characteristic of a perfectly competitive market? Multiple Choice All…
A: In perfectly competitive market, there are many firms and buyers. Sellers produce identical goods…
Q: Erhan's opportunity cost of 1 bushel of corn is 3 bushels of wheat. Panikos' opportunity cost of 1…
A: According to comparative advantage theory, if a person has a lower opportunity cost in the…
Q: A) True or false: The marginal utility of good 1, that is, MU1, must be diminishing in x1. B) True…
A: 1) Solution: True Explanation: The marginal utilities of good 1 will be calculated as: MU1 = ΔU/…
Q: A consumer of two goods has indirect utility v(p, w) = -1/2 +P₂ (a) Find the indirect money-metric…
A: Indirect utility function means a combination of the function of prices of goods and income of…
Q: The GDP of the U.S. in 2002 was around $10 trillion. This means Group of answer choices All of…
A: The final value of the goods and services produced by an economy inside its domestic territory…
Q: what is a gig economy
A: Gig economy could be understood as the type of economy where the work is not given on permanent…
Q: Suppose an economy produces steel, wheat, and oil. The steel industry produces $80,000 in revenue,…
A: Gross Domestic Product or GDP is the aggregate of the money value of all products and services…
Q: 15. Formulate reasons as to why a recession might occur. Then, hypothesize how total economic output…
A: 15) Either a negative aggregate supply shock or a negative aggregate demand shock could trigger a…
Q: A certain property is being sold and the new owner received two bids. The first bidder offered to…
A: Compound interest:- The interest on loans or deposits that are calculated using both initial…
Q: For each of the following situations, i) Find the Marginal Rate of Substitution at the given bundle,…
A: As given the U(x, y) = 2X +3Y, Marginal rate of substitution is the slope of indifference curve also…
Q: Which of the following is the proper formula for GDP once you adjust it so it explicitly shows the…
A: GDP The market value of all financial goods and services produced in a domestic territory over a…
Q: Anna's $500,000 was invested in a bank for 5 years at 10% interest rate compounded quarterly. If the…
A: Given invested amount = 500,000 $ Time = 5 years Interest rate = 10 % compounded quarterly = 10 / 4…
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- How do we measure utility? Are interpersonal (i.e. between people) comparisons valid? Why or why not?‘‘Risk-averse people should only be averse to big gambles with a lot of money at stake. They should jump on any small gamble that is unfair in their favor.’’ Explain why this statement makes sense. Use a utility of income graph like Figure 4.1 to illustrate the statement. For a challenge, demonstrate the statement using a two-state graph like Figure 4.6.When consumers were given the opportunity to select a package of ground beef labeled “75% lean” or a package of ground beef labeled “25% fat,” most consumers chose “75% lean.” Why? What concept from the chapter does this illustrate? The reason is that consumers are swayed by cheap talk. Cheap talk is the concept. The reason is that consumers are much more likely to choose the alternative framed as the positive option. This is called a framing effect. The reason is that consumers infer the value of a product from positive advertising. This is called inference induction. The reason is that consumers respond better to higher numbers. They feel they are getting more because 75 is greater than 25. The concept is the endowment effect.
- If Ty's marginal utility for a cup of coffee is 20 and his marginal utility of a donut is 10, then A. they should both be purchased. B. coffee should be his next purchase. C. a donut should be his next purchase. D. price information is also needed to determine what Ty should purchase next.Vilfredo has complete and transitive preferences on cars. We know that he prefers a Hyundai Sonata to a Mazda 3, and that he finds a Mazda 3 at least as good as a Honda Civic. Can we conclude that he prefers a Hyundai Sonata to a Honda Civic? Yes NoSuppose Jessica has two choices: receive $12000 and 30 utils or take a gamble that has a 55% chance of a $20000 and 45 utils, and a 45% chance of a $0 payoff and zero utility. Assuming Jessica is a utility maximizer, what will she likely choose? a) Jessica will not take the gamble b) Jessica will take the gamble c) It cannot be determined d) Jessica is indifferent
- Let U = XY and Px = 2 and Py = 4 and the consumers income is 32. Then, the maximum utility the consumer can get is _____. Group of answer choices a. 64 b. 32 c. 24 d. 16 e. none of the above.Bart and Lisa are both optimizing consumers in the market for shirts and hats, where they pay $100 for a shirt and $50 for a hat. Bart buys 8 shirts and 4 hats, while Lisa buys 6 shirts and 12 hats. From this information, ignoring the minus sign, we can infer that Bart's marginal rate of substiution is _________ hats per shirt, while Lisa's is __________ hat's per shirtSuppose that you graduate from college next year and you have two career options: 1) You will start a job in an investment bank paying a $100,000 annual salary. 2) You will start a Ph.D. in economics and, as a student, you will receive a $20,000 salary. You are bad with decisions, so you are letting a friend of yours decide for you by flipping a coin. The probabilities of options 1 and 2 are, therefore, each 50%. a) Illustrate, using indifference curves, your preferences regarding consumption choices in the two different states of the world. Assume that you are risk-averse. [Include also the 45 degrees line in your figure] b) Now show how the indifference curves would change if you were substantially more risk averse than before. Explain. c) Now show the indifference curves if you are risk neutral and if you are risk loving. d) Show your expected utility preferences from point a) mathematically.
- From the given graph solve all three true or false statements.please answer a & b In a used car market there are two types of cars: bad (B) and good (G). Assume that the utility from a bad car is Ub= Php100, and the utility from a good car is Ug = Php1000. Jaebeom, the owner of IGOT7 Used Cars Company, buys cars from the general public for his lot (assume he just keeps them on his lot for now). The owners of the cars who are selling to Jaebeom know the qualities of the cars they are selling, but Jaebeom does not. a. If car type is observable, what is the price paid for good and bad-type cars?b. Describe the equilibrium in the market assuming that Jaebeom can only offer the same buying price toany car in the market (i.e. cannot discriminate among sellers). What is the equilibrium used car price?Asap Suppose Faith and Mickey are playing both dictator and ultimatum games. Faith is the dictator/proposer and has $80 to allocate. Based on repeated experiments of the dictator and ultimatum games, what payouts to Mickey would be most consistent with the findings of behavioral economists? Multiple Choice O. Mickey receives $0 from the dictator game and $8 from the ultimatum game. O. Mickey receives $47 from the dictator game and $42 from the ultimatum game. O. Mickey receives $40 from the dictator game and $40 from the ultimatum game. O. Mickey receives $33 from the dictator game and $38 from the ultimatum game.