A grocery store is considering putting broccoli on sale, temporarily reducing the price 501%. Let Y₁¡ denote the amount of broccoli household i would purchase if broccoli is on sale when they visit the grocery. And let Yoi denote the amount of broccoli household i would purchase if broccoli is not on sale when they visit the grocery. Which of the following represents the causal effect of putting broccoli on sale on the amount of broccoli household i purchases? O Y₁1-You Ο Yli 00 +Y 2 OF

A grocery store is considering putting broccoli on sale, temporarily reducing the price 501%. Let Y₁¡ denote the amount of broccoli household i would purchase if broccoli is on sale when they visit the grocery. And let Yoi denote the amount of broccoli household i would purchase if broccoli is not on sale when they visit the grocery. Which of the following represents the causal effect of putting broccoli on sale on the amount of broccoli household i purchases? O Y₁1-You Ο Yli 00 +Y 2 OF

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter4: Utility Maximization And Choice

Section: Chapter Questions

Problem 4.2P

See similar textbooks

Similar questions

Why does a change in income cause a parallel shift in the budget constraint?
5.1 Explain, with the aid of a graph, the effect of an increase in income on theequilibrium price and quantity of wine if wine is an inferior good.
Joe likes eating candy and drinking soda, The price of a bar of candy is $2 while the price of a can.of soda is $3. joe has a budeet of 529. Suppose that candy and soda can only be purchased and consumed as whole units (in other words it is impossible for Joe to purchase 1/3 of a bar of candy or A/5 of a can of soda). Furthermore, assume that it is impossible for Joe to spend more than his budget (that is, his total expenditure on candy and soda cannot exceed his budget). The following table describes the marginal benefit (expressed in $) he obtains from each bar of candy and can of soda Marginal Benefit from Marginal Benefit from Soda (in $) Unit Candy (in $) 180 180 160 150 3 140 120 60 5. 100 45 60 30 7. 40 15 8 10 -30 9. 60 -90 10 -100 -120 Joe's optimal consumption bundle includes (enter a numerical answer here) bars of candy and (enter o (enter a numerical answer here) cans of soda, and the total benefit he derives from the consumption of the optimal bundle is $ numerical answer…
Good Y 20 Each week, Mary Selects the quantity of two goods, X and Y that she will consume in order to maximize her utility. She spends her entire weekly income on these two goods. Suppose you are given the following information about a three-week period, the choices that Mary makes over Where Px is the price of good X, Py is the price of good Y, and I is income: Week 1 Week 2 مل ۳۰ رم Week 3 is 7 Hi▬▬▬▬t da. X 10 6 14 Px $1 $1 8 $1 Y GOOD 3 6 9 12 15 17 21 24 21 10 ९1 1) using the line drawing tool, graph Mary's budget line for each week. Label the line L₁, L₂, and 13. + $1 2) Using the point drawing tool, indicate Mary's utility-maximizing bundle for each week. Label these points A, B.C. 30 $2 $2 I 20 20 38
ЕОC 5.03 Assume that pizza and poutine are substitute goods in consumption. If the costs of producing poutine rise then the price of poutine would and the price of pizza would Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a fall; rise b fall; fall rise; fall rise; rise
Suppose you observed that the consumption of organges increased sharply last year, however thet total consumer expenditure on oranges did not change. Did a supply shift, demand shift or both cause this? explain using graphs
Consider John who consumes two goods, (X and Y), with prices ?? = ?$35, ?? = ?$25 and income I =N$1500 i) Construct budget constraint and draw John’s budget line with good X on the horizontal axis. (ii) Use a graph to show the effect of an increase in income from N$1500 to N$2000. What will happen to the slope of the budget line if the price of good X decreases to N$18?
32. If the demand of soup increases as the price of bread increases, the two goods would beclassified as:(a) substitutes(b) complements(c) neither substitutes nor complement
why does a decrease in income cause an increase in both equilibrum price and quanity of an inferior good, such as macaroni and cheese?
When and economist says the demand, for a product has increases, he or she mean that a) consumers are willing and able to purchase more at any given price. b) the demand curve has shifted to the left c) The product has become more scarce and consumers therefore want it more d)Consumers would be willing and able to pay less to recieve the same quantity. e)The price has decreased and consumers will therefore purhcase more of the product
On the graph below, the consumer begins at L1. The relative prices change to L2. Complete the table and the sentence below. (Hint: The dashed line is a reference line to show us the income effect. Point B shows only the income effect. The change from A to B is the income effect. The change from B to C is the substitution effect.) 1. Will consumption of Grenades increase or decrease due to the substitution effect? What is the quantity change in grenades due to substitution effect? 2. Will consumption of Porcupines increase or decrease due to the substitution effect? What is the quantity change in porcupines due to substitution effect? 3. Will consumption of Porcupines increase or decrease due to the income effect? What is the quantity change in porcupines due to the income effect?
The first table below shows the basket of the goods Ann consumes over four time periods, T1 to T4. The second table shows Ann's income over the same periods. Assume that Ann consumes the same amount of each good in all time periods. Use the tables to answer the following questions. Quantity Price Price Price Price Consumed T1 Time Income Goods T2 T3 T4 T1 $5,000 300 T2 $5,200 Eggs $3.50 $4.00 $5.20 $5.00 (Dozen) T3 $5,870 60 Bread $4.50 $5.00 $6.00 $5.40 T4 $5,810 (Loaves) 40 Cheese $6.00 $6.50 $7.40 $6.40| (Blocks) 500 Gas $3.50 $3.40 $4.00 $3.90 (Gallons) |DVD's 70 (Units) $11 | $10 $8.50 $8.50 a. What was the percentage inflation rate facing Ann for this basket of goods in each of the following time periods? Please give your answer to the nearest whole percentage. T1 to T2: % T2 to T3: