Question

5. Harry Mazola [4.7] has preferences u = min (2x + y, x + 2y). Graph the u = 12 indifference curve. Mary Granola has preferences u = min (8x + y, 3y + 6x). Graph the u = 18 indifference curve.

6. A consumer with m = 60 is paying pY = 2. They must pay pX = 4 for the first 5 units of good x but then pay only pX = 2 for additional units. The horizontal intercept of the budget line is equal to __________. No diagram required. Show your work.

7. A consumer with m = 64 paying pY = 2, pX = 2 purchases x = 12, y = 8. There is a tX = 2 per-unit tax on good x so while pX = 2, the customer pays pX + tX = 4 per unit. Next month the per-unit tax will be eliminated, but replaced with a revenue equivalent lump-sum tax. The horizontal intercept of this budget line will be equal to No diagram required. Show your work.

Answer #1

In the first question we have to simply draw two indifference curve for different value of utility. In the second and third part of the question we have two find horizontal intercept of the budget constraint under different scenario.

For Mary granola indifference curve , I have drawn it using online tool and the indifference curve is eq1 line running from vertical axis till point (2,2) and from there eq2 running from there to horizontal intercept of that line.

where eq1 is 8x+y =18 and eq 2 is 3y+6x =18

A consumer has preferences given by U(x, y) = min[x, y].
(a) Calculate the equilibrium quantities of x and y when px = $2,
py = $3
and I = 12.
(b) Suppose px increases to $3 when a per unit tax of $1 is placed
on x.
What is the new value of x and how much tax revenue is
raised?
(c) Suppose that the same tax revenue is raised by an income tax
as
opposed to a per...

Suppose a consumer's preferences are given by U(X,Y) = X*Y.
Therefore the MUX = Y and MUY = X. Suppose
the price of good Y is $1 and the consumer has $80 to spend (M =
80). Sketch the price-consumption curve for the
values
PX = $1
PX = $2
PX = $4
To do this, carefully draw the budget constraints associated with
each of the prices for good X, and indicate the bundle that the
consumer chooses in each...

Suppose a consumer has the utility function u(x, y) = x + y.
a) In a well-labeled diagram, illustrate the indifference curve
which yields a utility level of 1.
(b) If the consumer has income M and faces the prices px and py
for x and y, respectively, derive the demand functions for the two
goods.
(c) What types of preferences are associated with such a utility
function?

Given the following utility function: U (X,Y) = 2X½ + Y and
given that U = 40
Part 1: Find Y1 for X = 4
Part 2: Find Y1 for X = 9
Part 3: Find Y1 for X = 16
Part 4: Find Y1 for X = 36
Part 5: Find Y1 for X = 49
Using graph paper construct the graph for indifference curve for
U = 40 Given : Py = 20, Px = 5 and I...

Suppose a consumer has the utility function u(x,y)=x+y -
(a) In a well labelled diagram illustrate the indifference curve
which yields a utility level of 1
(b) If the consumer has income And faces the prices Px and Py
for x and y, respectively, derive the demand function for the two
goods
(c) What types of preferences are associated with such a utility
function?

1. Suppose utility for a consumer over food(x) and clothing(y)
is represented by u(x,y) = 915xy. Find the optimal values of x and
y as a function of the prices px and py with an income level m. px
and py are the prices of good x and y respectively.
2. Consider a utility function that represents preferences:
u(x,y) = min{80x,40y} Find the optimal values of x and y as a
function of the prices px and py with an...

. Suppose utility is given by the following function:
u(x, y) = min(2x, 3y) Suppose Px = 4, Py =
6, and m = 24.
Use this information to answer the following questions:
(a) What is the no-waste condition for this individual?
(b) Draw a map of indifference curves for these preferences. Be
sure to label your axes, include the no-waste line, and draw at
least three indifference curves.
(c) Given prices and income, what is the utility-maximizing
bundle of...

Consider a consumer with the utility function U(x, y) = min(3x,
5y). The prices of the two goods are Px = $5 and Py = $10, and the
consumer’s income is $220. Illustrate the indifference curves then
determine and illustrate on the graph the optimum consumption
basket. Comment on the types of goods x and y represent and on the
optimum solution.

Dan’s preferences are such that left shoes (good x) and right
shoes (good y) are perfect complements. Specifically, his
preferences are represented by the utility function U (x, y) =
minimum{x, y}.
(a) Draw several of Dan’s indifference curves. Which bundles are
at the “kink- points” of these curves?
(b) Assume that Dan’s budget for shoes is M = 10 and that the
price of a right shoe is py = 2. Find and draw Dan’s demand curve
for left...

Tamer derives utility from goods X and Y, according to
the following utility function: U(X,Y)= 3 X radical y . His budget
is $90 per period, the price of X is PX=$2, and the
price of Y is PY=$6.
1. Graph the indifference curve when U=
36
2. What is the Tamer’s MRS between goods X
and Y at the bundle (X=8 and Y=2 )? What does the value of MRS
means? (أحسب القيمة واكتب بالكلمات ماذا تعني القيمة)
3....

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