To reward her loyal business, the entertainment company Heather hires has offered hera 50 percent discount on entertainment purchases for this year’s party. On your graph,illustrate Heather’s new budget constraintfor food and entertainment
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To reward her loyal business, the entertainment company Heather hires has offered her
a 50 percent discount on entertainment purchases for this year’s party. On your graph,
illustrate Heather’s new budget constraint
for food and entertainment
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- Assume that Sophia has $1000 per month to spend between dinners at a Thairestaurant and evenings at MECA, a local club. Assume that going to MECAcosts $200 and eating at the Thai restaurant costs $100.i. Draw Sophia’s budget constraint. Restaurants on the Y axis. ii. Assume that Sophia’s income rises and she can now spend $2000 permonth. Draw her new budget constraint in relation to the old.iii. Suppose the price of evenings at MECA increase to $1200, while Sophia’sincome and the price of the Thai restaurant is unchanged from part (i).Illustrate the new budget line in relation to the oldAssume that Sophia has $1000 per month to spend between dinners at a Thairestaurant and evenings at MECA, a local club. Assume that going to MECAcosts $200 and eating at the Thai restaurant costs $100.i. Draw Sophia’s budget constraint. Restaurants on the Y axis. ii. Assume that Sophia’s income rises and she can now spend $2000 permonth. Draw her new budget constraint in relation to the old. iii. Suppose the price of evenings at MECA increase to $1200, while Sophia’sincome and the price of the Thai restaurant is unchanged from part (i).Illustrate the new budget line in relation to the oldAssume that Sophia has $1000 per month to spend between dinners at a Thairestaurant and evenings at MECA, a local club. Assume that going to MECAcosts $200 and eating at the Thai restaurant costs $100.i. Draw Sophia’s budget constraint. Restaurants on the Y axis. ii. Assume that Sophia’s income rises and she can now spend $2000 permonth. Draw her new budget constraint in relation to the old. iii. Suppose the price of evenings at MECA increases to $1200, while Sophia’sincome and the price of the Thai restaurant are unchanged from part (i).Illustrate the new budget line in relation to the old
- Jack derives utility from Hokey course (H) and Chess course (C) as given by the following utility function:U (H, C) = √HCThe average price for the hokey course is 20 dollars and for chess course16 dollars. Moreover, Jack has a budgetof 80 dollars. c) Find the income level which is necessary to make Jack reach the same utility level as before theprice change.d) Compute the quantities demanded with the new prices and the income you found in section c.e) Compute the quantities demanded with the new prices and the original budget of 800 dollars.Utility maximization with a budget constraint. A hypothetical consumer spends all tgheir income on ramen noodles (N) and wild rice (W). N is the quantity of noodles; W is the quantity of wild rice. Their income is $1,600 per month. the price of noodles is $2 per package and the price of wild rice is $20 per pound. The utility function is U=sqrt(N*W). the MRS = -N/W. The budget constraint is: 1,600 = 2*N + 20*W Graph Qty of noodles (N) on vertical axis and Qty of wild rice (W) on horizontal axis. SOLVE: a. Graph the budget constraint. label all points. What is the slope of the budget constraint? b. Find the optimal quantities of noodles(# of packages) and the wild rice (# of pounds) given the budget constraint. graph these optimal quantities. draw your indifference curve on the same graph. c. Show on your graph what happens when the price of wild rice increases to $40 per pound. Find your new optimal quantities of noodles and wild rice. label all points on graph. label the…please solve C by midpoint method Suppose that the demand schedule for rice for a Saudi family is as follows:PriceQuantity DemandedOf Rice Per Month(income = SR 10,000)Quantity DemandedOf Rice Per Month(income = SR 15,000)SR 5 60 70SR 4 80 95SR 3 100 120SR 2 120 145SR 1 140 170a. Given the table above, draw the demand curve of rice using Excel.b. Show what will happen to your graph if this family like now less rice as they are eatingmore outside.c. Use the midpoint method to calculate the price elasticity of demand as the price of riceincreases from SR 4 to SR 5 if (i) family’s income is SR 10,000 and (ii) family’s income is SR15,000.
- Jody has $360 to spend on her summer vacation. She decided to use the moneyon trips to the zoo and on tickets to the movies. Her original budget constraintis shown below. Let X represent movie tickets and Y represent trips to the zoo.i. What is the equation of the original budget constraintQues 1. Sally consumes two goods, X and Y. Her utility function is given by the expression U=3XY2. The marginal utility of X and marginal utility of Y are given by the following equations: MUX=3Y2 and MUY=6XY The current market price for X is $10, while the market price for Y is $5. Sally's current income is $500. A) Draw out Sally’s budget line. (show the points where it meets the vertical and horizontal axes) B) Determine the X,Y combination which maximizes Sally's utility, given her budget constraint. (Partial units for the quantities are possible.) [Hint: One of the ways to do this is to use the equal marginal principle to find the optimal ratio of X to Y and then use that in the budget equation]. C) How much is Sally’s utility? Now the price of X increases to $15. What is the ratio in which she will consume X and Y ?Jody has $360 to spend on her summer vacation. She decided to use the moneyon trips to the zoo and on tickets to the movies. Her original budget constraintis shown below. Let X represent movie tickets and Y represent trips to the zoo.i. What is the equation of the original budget constraint? ii. What is the price of a movie ticket? a trip to the zoo? iii. Assume a price change occurs and Jody now faces the new budgetconstraint. What is the equation of the new budget constraint? iv. With the new budget constraint, what is the price of an amusement parkticket? a baseball ticket?
- Jody has $360 to spend on her summer vacation. She decided to use the moneyon trips to the zoo and on tickets to the movies. Her original budget constraintis shown below. Let X represent movie tickets and Y represent trips to the zoo.i. What is the equation of the original budget constraint? ii. What is the price of a movie ticket? a trip to the zoo? iii. Assume a price change occurs and Jody now face the new budgetconstraint. What is the equation of the new budget constraint? iv. With the new budget constraint, what is the price of an amusement parkticket? a baseball ticketJody has $360 to spend on her summer vacation. She decided to use the moneyon trips to the zoo and on tickets to the movies. Her original budget constraintis shown below. Let X represent movie tickets and Y represent trips to the zoo.i. What is the equation of the original budget constraint? ii. What is the price of a movie ticket? a trip to the zoo? iii. Assume a price change occurs and Jody now face the new budgetconstraint. What is the equation of the new budget constraint? iv. With the new budget constraint, what is the price of a movie ticket? atrip to the zoo?Assume that Raymond has $ 37.00 to spend on pretzels and beer. The price of pretzels is $3.00 and the price of beer is $5.00. Marginal utilities for each good are given below. Units MU P MU P / P P MU B MU B / P B 1st 18 6 40 8 2nd 15 5 30 6 3rd 12 4 25 5 4th 9 3 20 4 5th 6 2 15 3 6th 3 1 5 1 What Quantity of pretzels will Raymond purchase?