MICROECONOMICS 21E W/CNCT
21st Edition
ISBN: 9781307005851
Author: McConnell
Publisher: MCG/CREATE
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Chapter 7.1, Problem 4QQ
To determine
Marginal utility .
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SLOPE OF A LINE
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Explain graph c
Suppose you won $15 on a lotto ticket at the local 7-Eleven and decided to spend all the winnings on candy bars and bags of peanuts. The price of candy bars is $.75 and the price of peanuts is $1.50.a. Construct a table showing the alternative combinations of the two products that are available.b. Plot the data in your table as a budget line in a graph. What is the slope of the budget line? What is the opportunity cost of one more candy bar? Of one more bag of peanuts?Do these opportunity costs rise, fall, or remain constant as each additional unit of the product is purchased?c. How, in general, would you decide which of the available combinations of candy bars and bags of peanuts to buy?d. Suppose that you had won $30 on your ticket, not $15. Show the $30 budget line in your diagram. Why would this budget line be preferable to the old one?
Chapter 7 Solutions
MICROECONOMICS 21E W/CNCT
Ch. 7.1 - Prob. 1QQCh. 7.1 - Prob. 2QQCh. 7.1 - Prob. 3QQCh. 7.1 - Prob. 4QQCh. 7.A - Prob. 1ADQCh. 7.A - Prob. 2ADQCh. 7.A - Prob. 3ADQCh. 7.A - Prob. 1ARQCh. 7.A - Prob. 2ARQCh. 7.A - Prob. 1AP
Ch. 7.A - Prob. 2APCh. 7.A - Prob. 3APCh. 7 - Prob. 1DQCh. 7 - Prob. 2DQCh. 7 - Prob. 3DQCh. 7 - Prob. 4DQCh. 7 - Prob. 5DQCh. 7 - Prob. 6DQCh. 7 - Prob. 7DQCh. 7 - Prob. 8DQCh. 7 - Prob. 9DQCh. 7 - Prob. 10DQCh. 7 - Prob. 1RQCh. 7 - Prob. 2RQCh. 7 - Prob. 3RQCh. 7 - Prob. 4RQCh. 7 - Prob. 5RQCh. 7 - Prob. 1PCh. 7 - Prob. 2PCh. 7 - Prob. 3PCh. 7 - Prob. 4PCh. 7 - Prob. 5PCh. 7 - Prob. 6PCh. 7 - Prob. 7P
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- Scruffie the cat has $15 to spend each month on cat toys, which cost $3 each, and cat treats, which cost $1.50 each. Draw a budget line to show the combinations of each good that Scruffie can afford if she spends her entire budget. Now suppose that cat treats go on sale for $1 each. How does this change in price affect the budget line (describe and show on a graph)?arrow_forwardCome up with two variables that, in your view, are related, indicate the name of these variables as well as why these variables are related; determine which variable is the dependent variable and which one is the independent variable. Draw a line graph by hand, labeling the vertical and horizontal axis consistent with your choice of variables. The line in the line graph has to represent, what, in your view, is the relationship between the two variables. Describe your graph verbally in your post (no need to upload the graph itself). Note:- ā¢ Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. ā¢ Answer completely. ā¢ You will get up vote for sure.arrow_forward(Figure and Table: The Budget Line) Use Figure and Table: The Budget Line. A(n) _____ in the price of potatoes would rotate the budget line, changing the intercept on the _____ axis and moving it _____ the origin. Select one: a.Ā decrease; vertical; away from b.Ā increase; horizontal; away from c.Ā increase; vertical; away from d.Ā decrease; horizontal; towardarrow_forward
- It is known that the indifference curve is convex. What does this tell you about the relationship between the goods? 2. Using examples, does an increase in income affect a consumerās budget line? Does it impact their total utility.Ā 3.You are interested in starting a coffee shop at the University of the West Indies. Provide examples with explanations of explicit costs, implicit cost and sunk costs related to this business.arrow_forward1. Suppose you won $15 on a lotto ticket at the local 7-Eleven and decided to spend all the winnings on candy bars and bags of peanuts. The price of candy bars is $.75 and the price of peanuts is $1.50. a. Construct a table showing the alternative combinations of the two products that are available.b. Plot the data in your table as a ābudgetā line in a graph. What is the slope of the ābudgetā line? What is the opportunity cost of one more candy bar? Of one more bag of peanuts?arrow_forwardPROBLEM 2.25% PARTIAL DIFFERENTIAL LAGRANGE OPTIMIZATION In the era of the Covid 19 pandemic, we are required to consume lots of fresh fruits. The satisfaction of a consumer in consuming two kinds of fruit, namely Apples (X) and Oranges (Y) is: U = X3 Y2 income or budget to buy the two fruits is Rp. 250,000, the price of apples IDR 75,000/fruit and the price of oranges is IDR 25,000/fruit. a. How many apples and oranges must be obtained in order to achieve optimum satisfactionb. Calculate the optimum satisfaction value that can be achievedarrow_forward
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