Question

Questions 1 Fill in the blank: You want to graph the Engel curve for good y....

Questions 1 Fill in the blank: You want to graph the Engel curve for good y. The variable on the horizontal axis of this graph will be and the variable on the vertical axis will be .

Question 2 In words, interpret the income elasticity of demand for cereal being equal to 1.5. (Hint: your answer should include a %).

Question 3 For the utility function U(x, y) = 8ln(x) + 2y, solve for individual demand for goods x and y.

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
8. If the price consumption curve (as the price of x changes) is horizontal, then good...
8. If the price consumption curve (as the price of x changes) is horizontal, then good y must be a normal good. a. True b. False 9. If the income consumption curve is upward sloping, then the price consumption curve (as the price of x changes) must be upward sloping too. a. True b. False 10. If the income consumption curve is a horizontal line, then cross-price elasticity of demand for good y with respect to the price of good...
The utility that Mark receives by consuming good X and good Y is given by u(X,Y)...
The utility that Mark receives by consuming good X and good Y is given by u(X,Y) = XY. 1) Draw the indifference curve associated with a utility level of 12 and the indifference curve associated with the utility level of 36. 2) Suppose that X costs $1 per unit and Y $3 per unit. Mark has $12 to spend on X and Y. Graph the budget line that he faces. 3) Derive Mark’s demand functions. What is the utility-maximizing choice...
A consumer consumes only two commodities, X and Y. Imagine this consumer’s downward sloping demand curve...
A consumer consumes only two commodities, X and Y. Imagine this consumer’s downward sloping demand curve for commodity X, with price on vertical axis and quantity of X consumed on horizontal axis. Imagine two points on this demand curve, with point B falling to the right and lower than point A. Question 9 options: MRSxy is the same at A and B points MRSxy is less at B than at A B represents higher utility than A. Both a) and...
Suppose a consumer views two goods, X and Y, as perfect complements. Her utility function is...
Suppose a consumer views two goods, X and Y, as perfect complements. Her utility function is given by U = MIN [2X, Y]. Sketch the graph of the consumers indifference curve that goes through the bundle X = 5 and Y = 6. Put the amount of Y on the vertical axis, and the amount of X on the horizontal axis. Which of the three assumptions that we made about consumer preferences is violated in this case?
In a pure exchange economy, Ollie’s utility function is U(x, y) = 3x + y and...
In a pure exchange economy, Ollie’s utility function is U(x, y) = 3x + y and Fawn’s utility function is U(x, y) = xy. Ollie’s initial allocation is 1 x and no y’s. Fawn’s initial allocation is no x’s and 2 y’s. Draw an Edgeworth box for Fawn and Ollie. Put x on the horizontal axis and y on the vertical axis. Measure goods for Ollie from the lower left and goods for Fawn from the upper right. Mark the...
Consider the utility function U(x, y) = x0.4y0.6, with MUx = 0.4 (y0.6/x0.6) and MUy =...
Consider the utility function U(x, y) = x0.4y0.6, with MUx = 0.4 (y0.6/x0.6) and MUy = 0.6 (x0.4/y0.4). a) Is the assumption that more is better satisfied for both goods? b) Does the marginal utility of x diminish, remain constant, or increase as the consumer buys more x? Explain. c) What is MRSx, y? d) Is MRSx, y diminishing, constant, or increasing as the consumer substitutes x for y along an indifference curve? e) On a graph with x on...
Question 1 If good X is measured on the horizontal axis and good Y on the...
Question 1 If good X is measured on the horizontal axis and good Y on the vertical, what can you say about the preferences of someone whose indifference curves are described below? (i) parallel to the Y axis? (5 pts) (ii) upward sloping with utility increasing as one moves to the right? (5 pts) (iii) downward sloping with utility increasing as one moves to bottom-left? (5 pts)
Assume that the long-run aggregate supply curve is vertical at Y = 3, 000 while the...
Assume that the long-run aggregate supply curve is vertical at Y = 3, 000 while the short-run aggregate supply curve is horizontal at P = 1.0. The aggregate demand curve is Y = 2(M/P) and M = 1, 500. (Hint: draw a graph on this page to help you work through this question) 1) What is the velocity of money in this case? 2) Suppose the aggregate demand function shifts to Y = (1.5)(M/P). What are the short-run values of...
If a good is a normal good, its Engel curve should be Question 1 options: decreasing...
If a good is a normal good, its Engel curve should be Question 1 options: decreasing None of the other answers is correct a horizontal line increasing Question 2 (0.5 points) Which of the following claims about inferior goods is correct? Question 2 options: If a good is inferior, it will be so at all income levels (for the same individual) If a good is inferior it must be low quality When income goes up, the quantity demanded of the...
1.Suppose there are two consumers, A and B. The utility functions of each consumer are given...
1.Suppose there are two consumers, A and B. The utility functions of each consumer are given by: UA(X,Y) = X^1/2*Y^1/2 UB(X,Y) = 3X + 2Y The initial endowments are: A: X = 4; Y = 4 B: X = 4; Y = 12 a) (10 points) Using an Edgeworth Box, graph the initial allocation (label it "W") and draw the indifference curve for each consumer that runs through the initial allocation. Be sure to label your graph carefully and accurately....
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT