Microeconomics, Student Value Edition Plus MyLab Economics with Pearson eText -- Access Card Package (6th Edition)
6th Edition
ISBN: 9780134304755
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
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Chapter 10, Problem 10.4.7PA
To determine
Endowment effect.
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Suppose you and your friend go out for dinner. Your friend orders a cheeseburger and fries. When your food first arrives, you ask your friend if you can have one of his fries. He looks at you like you are crazy and says, "No!" Then a few minutes later, after you both have started eating, you ask again, and your friend reluctantly says, "Sure. Go ahead."
An economist's explanation for your friend's change of heart is most likely to be that:
Your friend's total utility declines as he eats more fries, so he's more likely to share with you after he's eaten a few.
Your friend's marginal utility from eating additional fries declines as he eats more of them, so he's more likely to share with you after he's eaten a few.
Your friend's total utility increases as he eats more fries, so he's more likely to share with you after he's eaten a few.
Your friend's marginal utility from eating additional fries increases as he eats more of them, so he's more likely to share with you…
Consider a hypothetical consumer named Hayden who is shopping for bread and brie. The graph with bread and brie on the axes presents the utility‑maximizing combinations of bread and brie that Hayden chooses when the price of bread is $1.00$1.00 per loaf and the price of brie is $4.00$4.00 and $6.00$6.00 per wheel, respectively. The other graph shows Hayden's demand curve for brie.
The two points and associated values in the graph for bread and brie combinations correspond to points A and B in the graph of the demand curve for brie. What are the specific prices and quantities of brie associated with points A and B on Hayden's demand curve?
price of brie at point A: $$
quantity demanded at point A:
price of brie at point B: $$
quantity demanded at point B:
Van has plans to go to an opera and already has a $100 nonrefundable, nonexchangeable, and nontransferable ticket. Now Amy, whom Van has wanted to date for a long time, asks him to a party. Van would prefer to go to the party with Amy and forgo the opera, but he doesn't want to waste the $100 he spent on the opera ticket.
From the perspective of an economist, if Van decides to go to the party with Amy, what has he just done?
1. Incorrectly allowed a sunk cost to influence his decision
2. Made a choice that was not optimal
3 Correctly ignored a sunk cost
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Chapter 10 Solutions
Microeconomics, Student Value Edition Plus MyLab Economics with Pearson eText -- Access Card Package (6th Edition)
Ch. 10.A - Prob. 1RQCh. 10.A - Prob. 2RQCh. 10.A - Prob. 3RQCh. 10.A - Prob. 4PACh. 10.A - Prob. 5PACh. 10.A - Prob. 6PACh. 10.A - Prob. 7PACh. 10.A - Prob. 8PACh. 10.A - Prob. 9PACh. 10.A - Prob. 10PA
Ch. 10.A - Prob. 11PACh. 10.A - Prob. 12PACh. 10 - Prob. 10.1.1RQCh. 10 - Prob. 10.1.2RQCh. 10 - Prob. 10.1.3RQCh. 10 - Prob. 10.1.4RQCh. 10 - Prob. 10.1.5PACh. 10 - Prob. 10.1.6PACh. 10 - Prob. 10.1.7PACh. 10 - Prob. 10.1.8PACh. 10 - Prob. 10.1.9PACh. 10 - Prob. 10.1.10PACh. 10 - Prob. 10.1.11PACh. 10 - Prob. 10.1.12PACh. 10 - Prob. 10.2.1RQCh. 10 - Prob. 10.2.2RQCh. 10 - Prob. 10.2.3RQCh. 10 - Prob. 10.2.4PACh. 10 - Prob. 10.2.5PACh. 10 - Prob. 10.2.6PACh. 10 - Prob. 10.2.7PACh. 10 - Prob. 10.2.8PACh. 10 - Prob. 10.2.9PACh. 10 - Prob. 10.2.10PACh. 10 - Prob. 10.2.11PACh. 10 - Prob. 10.3.1RQCh. 10 - Prob. 10.3.2RQCh. 10 - Prob. 10.3.3RQCh. 10 - Prob. 10.3.4PACh. 10 - Prob. 10.3.5PACh. 10 - Prob. 10.3.6PACh. 10 - Prob. 10.3.7PACh. 10 - Prob. 10.3.8PACh. 10 - Prob. 10.3.9PACh. 10 - Prob. 10.4.1RQCh. 10 - Prob. 10.4.2RQCh. 10 - Prob. 10.4.3RQCh. 10 - Prob. 10.4.4RQCh. 10 - Prob. 10.4.5PACh. 10 - Prob. 10.4.6PACh. 10 - Prob. 10.4.7PACh. 10 - Prob. 10.4.8PACh. 10 - Prob. 10.4.9PACh. 10 - Prob. 10.4.10PACh. 10 - Prob. 10.4.11PACh. 10 - Prob. 10.4.12PACh. 10 - Prob. 10.4.13PACh. 10 - Prob. 10.4.14PACh. 10 - Prob. 10.4.15PACh. 10 - Prob. 10.4.16PA
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