Principles of Microeconomics California Edition 2nd Edition
2nd Edition
ISBN: 9780393622089
Author: Dirk Mateer, Lee Coppock
Publisher: W. W. Norton
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Question
Chapter 16, Problem 4SP
To determine
Calculation of consumer’s optimum.
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Suppose you have a budget of $12 and cost of a cola is $2 and sandwich is $4. Using this information form the table, how many sandwiches and cola would you buy at the optimum?
Marie has a weekly budget of $24. Pie's are $12. Magazine's are $4. What is the maximum number of pies Marie can buy in a week? What is the maximum number of magazines Marie can buy in a week?
When a consumer is below the budget line, what does it mean?
Chapter 16 Solutions
Principles of Microeconomics California Edition 2nd Edition
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- How a price change affects consumer optimum?arrow_forwardUsing the consumer choice theory, explain how an individual decides what combination of different products to buy?arrow_forwardLouis is trying to decide what combination of cups and plates to buy. His budget is $12. Plates cost $4 each and cups cost $2 each. The numbers in the table represent total utility. Given his budget, which combination will maximize total utility? number of plates and cups.arrow_forward
- Explain the four kinds of utility.arrow_forwardExplain utility and its connection to consumer behaviorarrow_forwardSuppose John decides to buy 4 units of food and 4 units of clothing with his $12 budget. Would his marginal utility per dollar spent on food be greater than or less than his marginal utility per dollar spent on clothing? What does this tell you about how he should substitute food for clothing if he wanted to increase his utility without spending any more money?arrow_forward
- Suppose one have a budget of $1000. The price of one unit of X is $20 and the price of one Unit of Y Is $10 If X provides one utility and Y gives one disutility, what is the equilibrium amount of X and Y for the consumer! Explain your answer with graph!arrow_forwardHow does a consumer’s optimal choice of goods change if all prices and the consumer’s income double?arrow_forwardSuppose a person allocates a given budget between food and clothing. If food is an inferior good can you tell whether clothing is inferior or normal? Explain.arrow_forward
- Marie has a weekly budget of $24, which she likes to spend on magazines and pies. If the price of a magazine is $4 each, what is the maximum number of magazines she could buy in a week?arrow_forwardSuppose you have a budget of 30 to spend on two goods: pizzas and burgers. Each pizza is $5 while each burger is $10. Suppose you already purchased 6 pizzas. What is the maximum number of burgers that you can buy with the remaining funds in your budget?arrow_forwardDescribe the point at which a consumer maximizes utility.arrow_forward
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