Jane is your typical economics student who consumes two goods: economics textbook and coffee. Jane’s income is $40. She can spend it all on books and get 5 or she can spend it all on coffee and get 20 cups.Given this information, construct the equation for Jane’s budget line and plot it (put books on the x–axis and coffee on the y–axis) The following are bundles that Jane can afford with her income (as shown in Table 3.1):Table 3.1BooksCoffee 1- -0 -8 2- Fill in the blanks in the table with quantities that can exhaust Jane’s income. Assume that prices are the same as used in part (a). If marginal utility of a book is 20, what is the marginal utility of coffee if she is maximizing utility?
Jane is your typical economics student who consumes two goods: economics textbook and coffee. Jane’s income is $40. She can spend it all on books and get 5 or she can spend it all on coffee and get 20 cups.
Given this information, construct the equation for Jane’s budget line and plot it (put books on the x–axis and coffee on the y–axis)
The following are bundles that Jane can afford with her income (as shown in Table 3.1):
Table 3.1
Books
Coffee
1
-
-
0
-
8
2
-
Fill in the blanks in the table with quantities that can exhaust Jane’s income.
Assume that
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