Monika eats only steak and carrots for dinner. A serving of steak gives 250 calories and 10 units of vitamins. A serving of carrots offers 100 calories and 30 units of vitamins. Monika’s doctor instructs her to get a maximum of 2000 calories and at least 150 units of vitamins.NOTE: THE CALORIE CONSTRAINT AND VITAMIN CONSTRAINT ARE INEQUALITIES, BUT BOTH DO INCLUDE EQUALITY AS WELL. With ‘serving of carrots’ on the horizontal axis and ‘servings of steak’ on the vertical axis, draw BOTH the CALORIE constraint (= BUDGET) line, AND ‘VITAMIN’ (= BUDGET) line [Write at least 4 combinations of ‘steak’ and ‘carrots’]. Shade all the bundles of carrots and steaks that satisfy both ‘calorie’ and ‘vitamin’ requirements (= AS CONSTRAINTS) suggested by Monika’s doctor.On the graph, draw an indifference curve to show that Monika prefers to have X OZ steak and a Y OZ cup of carrots. More of either steak or carrots will not change the utility. SHOW THE OPTIMAL BUNDLE OF CARROTS AND STEAKS on the graph.Based on the information given in c), explain Monika’s ability to substitute between steak and carrots.

It is given that,1 unit of serving steak = 250 calories + 10 Vitamins 1 unit of…

Answered: Monika eats only steak and carrots for…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Monika eats only steak and carrots for dinner. A serving of steak gives 250 calories and 10 units of vitamins. A serving of carrots offers 100 calories and 30 units of vitamins. Monika’s doctor instructs her to get a maximum of 2000 calories and at least 150 units of vitamins.

NOTE: THE CALORIE CONSTRAINT AND VITAMIN CONSTRAINT ARE INEQUALITIES, BUT BOTH DO INCLUDE EQUALITY AS WELL.

With ‘serving of carrots’ on the horizontal axis and ‘servings of steak’ on the vertical axis, draw BOTH the CALORIE constraint (= BUDGET) line, AND ‘VITAMIN’ (= BUDGET) line [Write at least 4 combinations of ‘steak’ and ‘carrots’].
Shade all the bundles of carrots and steaks that satisfy both ‘calorie’ and ‘vitamin’ requirements (= AS CONSTRAINTS) suggested by Monika’s doctor.
On the graph, draw an indifference curve to show that Monika prefers to have X OZ steak and a Y OZ cup of carrots. More of either steak or carrots will not change the utility. SHOW THE OPTIMAL BUNDLE OF CARROTS AND STEAKS on the graph.
Based on the information given in c), explain Monika’s ability to substitute between steak and carrots.

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