"Question 3 (Consumer Choice )"Answer the following questions:a. Suppose shawarma cost $2 and briyani rice cost $3. If the marginal utility of shawarma at the optimalmix of consumption is 10 utils, what is the marginal utility of a briyani rice?b. Under what conditions can sellers engage in price discrimination? Give an example of pricediscrimination."Answer"

a) In a two goods case, optimality is attained when marginal utility per dollar of both the goods…

"Question 3 (Consumer Choice )" Answer the following questions: a. Suppose shawarma cost $2 and briyani rice cost $3. If the marginal utility of shawarma at the optima mix of consumption is 10 utils, what is the marginal utility of a briyani rice? b. Under what conditions can sellers engage in price discrimination? Give an example of price discrimination.

"Question 3 (Consumer Choice )" Answer the following questions: a. Suppose shawarma cost $2 and briyani rice cost $3. If the marginal utility of shawarma at the optima mix of consumption is 10 utils, what is the marginal utility of a briyani rice? b. Under what conditions can sellers engage in price discrimination? Give an example of price discrimination.

ECON MICRO

5th Edition

ISBN:9781337000536

Author:William A. McEachern

Publisher:William A. McEachern

Chapter6: Consumer Choice And Demand

Section: Chapter Questions

Problem 1.1P

See similar textbooks

Similar questions

Question 13 If the marginal utility of a commodity is zero, then: Total utility of this commodity has reached a maximum. The paradox of value must have been reached. The commodity in question has no utility, i.e. it’s not one that consumers want to use. Total utility for this commodity must be zero also.
Question 3 In the car rental industry, each car rental firm typically offers many different types of carsat different prices. However, during a long period when US households’ income(consumer income) got lower, firms tended to offer fewer types of cars (fewer versions).about versioning, what could be the possible reason?Possible reason:
Find solutions for your homework business economics economics questions and answers 2.suppose that a busy restaurant charges $9 for its octopus appetizer. at this price, an average of 48 people orders the dish each night. when it raises the price to $12, the number ordered per night falls to 42. assuming that demand is linear, find the demand curve the restaurant faces. what price should the restaurant Question: 2.Suppose That A Busy Restaurant Charges $9 For Its Octopus Appetizer. At This Price, An Average Of 48 People Orders The Dish Each Night. When It Raises The Price To $12, The Number Ordered Per Night Falls To 42. Assuming That Demand Is Linear, Find The Demand Curve The Restaurant Faces. What Price Should The Restaurant This problem has been solved! See the answer 2.Suppose that a busy restaurant charges $9 for its octopus appetizer. At this price, an average of 48 people orders the dish each night. When it raises the price to $12, the number ordered per night…
Help in deciding the correction answer 1. The Law of diminishing marginal utility explains why a. most individual demand curves are straight lines. b. the consumer;s optimal purchase is at the tangency of an indiffernce curve and the budget line. c. most individual demand curves slope downward d. marginal utility falls when total utility falls 2. when a firm's price cut produces a smaller than proportional increase in quantity demanded, the demand for its product is a. elastic b. inelastic c. of unit elasticity d. straight elastic 3. A good will tend to be more price elastic if it a. luxury good b. no close substitutes c. small part of the household budget d. is a necessity
Make sure that no plagiarism otherwise I will give you downvote Explain what is meant by cross-price effects. and explain how the cross-price effects can explain the consumer's optimal choice.
17. Evaluate the truthfulness of the following statements:I. The Engel curve for a normal good is upward sloping.II. The Engel curve for an inferior good is downward sloping.(a) Both I and II are false.(b) Both I and II are true.(c) I is true; II is false.(d) I is false; II is true.
Question Suppose the demand function for good X is given by Q^d_X = 10 - 1.8P_x + 0.5P_y + 0.07M + 0.01A where P_x is price of good X, P_Y is price of good Y, M is average income of individuals consuming good X, and A is advertising expenditure. Currently, P_x = $5, P_y = $I2, M = $200 and A = $600. Based on this information, which of the following is/are true? A 10% increase in the price of good Y will cause the quantity demanded of Good X to decrease by approximately 2.22% Demand for Good X is relatively inelastic Good X is a normal good I only II only I and III II and III I, II and III
Explain: “The success of a new product depends not only on its marginal utility but also on its price.”
Market demand: (2)(1) Shows how much an individual consumer is willing and able to purchase ateach price;(2) Is the vertical summation of all the individual demand curves in the market;(3) Shows how much firms are willing to supply in the market at each price;(4) Shows the total utility derived from consuming each unit. N.B multiple choice question
Need help with this. Picture 2 empty spots possible answers, You can choose only 1: Consider the graph. Suppose that the price of a sedan increased from $15,000 to $20,000. This would cause amovement along_______________(CHOOSE BETWEEN THESE: Movement along or shift of) the demand curve. A decrease in average income causes a leftward___________ (CHOOSE BETWEEN THESE: Movement along or shift of) the demand curve; therefore, you may conclude that sedans are___________(CHOOSE BETWEEN THESE: a normal or an inferior) good. (Hint: Try substituting different values for Average Income in the graph input tool and observing what happens.) Suppose that the price of a subway ride falls from $3.00 to $2.50. Because driving a car and taking the subway are____________(CHOOSE BETWEEN: substitute goods or complementary goods) , a decrease in the price of a subway ride shifts the demand curve for sedans to the______________(CHOOSE BETWEEN THESE: right or left) .
The price of insulin injection kits, used by diabetic patients, increases from $45 to $52, but the equilibrium quantity remains the same. Is it possible? Explain why or why not. Use graph
1. A) When it comes to the level of utility that can be attained along an individual demand curve, which of the following is true? Group of answer choices a-the level of utility increases as the price of the product falls b-the level of utility decreases as the price of the product falls c-the level of utility increases as the price of the product rises d-the level of utility stays constant always B) From a price-consumption curve, we can obtain: Group of answer choices a-points required to demonstrate a shift in a demand curve b-points required to create a downward sloping market demand curve c-points required to construct a downward sloping demand curve d-an income-consumption curve. C) Which of the following claims is true at each point along a price-consumption curve? Group of answer choices a-Utility is maximized, and all income is spent. b-Utility is maximized but income is not all spent. c-The level of utility is constant. d-All income is spent, but utility…