Microeconomics (13th Edition)
13th Edition
ISBN: 9780134744476
Author: Michael Parkin
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Question
Chapter 9.1, Problem 2RQ
To determine
The relative
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
Janelle spends all of her income on songs from iTunes ($1 each) and apps ($5 each) for her iPhone. If she makes her best affordable choice, she purchases 20 songs and 4 apps, what is her real income in terms of apps?
Akua gets a research grant and her income increases to GHS 800 per month. What is the new equation of her budget line? What if income stays constant at GHS 400 and the price of Yoghurts increase to GHS10?
need quality answer
Nuoya has $256 to spend on cherry and/or coconuts. The price of cherry is $12/kg and the price of coconuts is $17/kg. What is the slope of her budget line, if cherry is on the horizontal axis and coconuts are on the vertical axis? Round your answer to two decimal places, if necessary.
Hint: is slope positive or negative?
Chapter 9 Solutions
Microeconomics (13th Edition)
Ch. 9.1 - Prob. 1RQCh. 9.1 - Prob. 2RQCh. 9.1 - Prob. 3RQCh. 9.1 - Prob. 4RQCh. 9.1 - Prob. 5RQCh. 9.2 - Prob. 1RQCh. 9.2 - Prob. 2RQCh. 9.2 - Prob. 3RQCh. 9.2 - Prob. 4RQCh. 9.3 - Prob. 1RQ
Ch. 9.3 - Prob. 2RQCh. 9.3 - Prob. 3RQCh. 9.3 - Prob. 4RQCh. 9.3 - Prob. 5RQCh. 9 - Prob. 1SPACh. 9 - Prob. 2SPACh. 9 - Prob. 3SPACh. 9 - Prob. 4SPACh. 9 - Prob. 5SPACh. 9 - Prob. 6SPACh. 9 - Prob. 7SPACh. 9 - Prob. 8SPACh. 9 - Prob. 9SPACh. 9 - Prob. 10SPACh. 9 - Prob. 11SPACh. 9 - Prob. 12APACh. 9 - Prob. 13APACh. 9 - Prob. 14APACh. 9 - Prob. 15APACh. 9 - Prob. 16APACh. 9 - Prob. 17APACh. 9 - Prob. 18APACh. 9 - Prob. 19APACh. 9 - Prob. 20APACh. 9 - Prob. 21APACh. 9 - Prob. 22APACh. 9 - Prob. 23APACh. 9 - Prob. 24APACh. 9 - Prob. 25APACh. 9 - Prob. 26APACh. 9 - Prob. 27APACh. 9 - Prob. 28APACh. 9 - Prob. 29APACh. 9 - Prob. 30APA
Knowledge Booster
Similar questions
- Explain the impact of the change in consumer's income on the demand of goods and services.arrow_forwardWhat happens to the original budget line if the income of the consumer falls by 25%? (i.e., Will there be a change in the slope and/or intercepts of the original budget line? If yes, what are those changes?) Draw the new budget line after the fall in income.arrow_forwardSuppose Matt’s income is $120. He plans to spend it on two goods bread and avacado. Prices are: Pb = $4 per loaf of bread, Pa = $1 per avocado If Matt spends all his income on loafs of bread, how many does he buy? If Matt spends all his income on avocadoes, how many does he buy? If Matt buys 10 loaf of bread, how many avocados can he buy? Plot each of the bundles from parts A – C on a graph that measures avocadoes on the horizontal axis and loaves of bread on the vertical axis, connect the dots to find Matt’s budget constraint. Show what happens to the budget constraint if his income falls to $100, (prices do not change). Show what happens to the budget constraint if price of avocado rises to Pa = $2 per avocado, (income and price of loaves of bread did not change).arrow_forward
- Use the following data to work problems from a) to e)Income = 20$, price of cake is 4$, price of coffee is 2$ a) Calculate Amy's real income in terms of cake. b) Calculate the relative price of cake in terms of coffee. c) Calculate the equation for Amy's budget line (with coffee on the left side). d) If Amy's income increases to 35$ a week and the prices of coffee and cake remain unchanged, describe the change in her budget line. e) If the price of coffee doubles while the price of cake remains at 4$ a cup and Amy's income remains at 20$, describe the change in her budget linearrow_forwardJeremy has a monthly income of $60. He spends his money making telephone calls (good ?, measured in minutes) at a price of ?? and on other composite good ?, whose price has been normalized to one, meaning ?? = $1. His mobile phone company offers him two plans: plan A, in which he pays no monthly fee and makes calls for $0.50 per minute, or plan B, in which he pays a $20 monthly fee and benefits from cheaper phone calls at $0.20 per minute.(a) Depict Jeremy’s budget constraint under each of the two plans, with the number of phone calls (good ?) in the horizontal axis and the composite good (good ?) in the vertical axis. (b) If Jeremy mentioned that plan A is better for him, what is the set of consumption bundles he may purchase if his behavior is consistent with WARP?arrow_forwardEren’s two main hobbies are taking vacations overseas (V) and eating expensive meals (M). His utility function is given as: U(V,M) = V^2MLast year, the average price of taking a vacation overseas was US$200 and the average price of an expensive meal is $50. However, due to supply problems in Onions, the average price of an expensive meal rose to $75. The average price of a vacation did not change. His income, which is $1500, did not change. Suppose that the Department of Welfare wants to know how much should be given to Eren to offset his change un utility due to the price increase of an expensive meal. Calculate the compensative variation (CV).arrow_forward
- This week Sara’s income falls from $12 to $9 a week, while the price of popcorn isunchanged at $3 a bag and the price of a smoothie is unchanged at $3.g. What is the effect of the fall in Sara’s income on her real income in terms ofsmoothies and in terms of popcorn?h. What is the effect of the fall in Sara’s income on the relative price of a smoothiein terms of popcorn? What is the slope of Sara’s new budget line if it is drawnwith smoothies on the x-axis?arrow_forwardEren’s two main hobbies are taking vacations overseas (V) and eating expensivemeals (M). His utility function is given as: U(V,M) = V2MLast year, the average price of taking a vacation overseas was US$200 and the averageprice of an expensive meal is $50. However, due to supply problems in Onions, theaverage price of an expensive meal rose to $75. The average price of a vacation did notchange. His income, which is $1500, did not change. Calculate the change in consumer surplus from consuming the expensivemeals considering the price change (Hint: you need to compare his optimalconsumption bundle before and after the price change to get the change in CS).arrow_forwardEren’s two main hobbies are taking vacations overseas (V) and eating expensivemeals (M). His utility function is given as: U(V,M) = V2MLast year, the average price of taking a vacation overseas was US$200 and the averageprice of an expensive meal is $50. However, due to supply problems in Onions, theaverage price of an expensive meal rose to $75. The average price of a vacation did notchange. His income, which is $1500, did not change. Calculate for the equivalent variation (EV) for the price change.arrow_forward
- The residents of Vegopia spend all of their income oncauliflower, broccoli, and carrots. In 2020, they spenda total of $200 for 100 heads of cauliflower, $75 for50 bunches of broccoli, and $50 for 500 carrots. In 2021,they spend a total of $225 for 75 heads of cauliflower,$120 for 80 bunches of broccoli, and $100 for 500 carrots.a. Calculate the price of one unit of each vegetable ineach year.b. Using 2020 as the base year, calculate the CPI foreach year.c. What is the inflation rate in 2021?arrow_forwardWhat's the relationship between economic well-being and social well-being (i.e happiness)?arrow_forwardFor part b, is the utility received just the MU/P of 5 books and 1 pizza added up?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Economics Today and Tomorrow, Student EditionEconomicsISBN:9780078747663Author:McGraw-HillPublisher:Glencoe/McGraw-Hill School Pub Co
Economics Today and Tomorrow, Student Edition
Economics
ISBN:9780078747663
Author:McGraw-Hill
Publisher:Glencoe/McGraw-Hill School Pub Co