Jul 16, 2015 · When the price changes from 2 to 3, what is the associated change in consumer’s surplus? (15) • Exercise on p. 263: Suppose that a consumer has a utility function u(x1, x2)= ࠵? 1 1 2 ࠵? 2 1 2. He originally faces prices (1, 1) and has income 100. Then the price of good 1 increases to 2. What are the compensating and equivalent variations?
Assume that a consumer has a given budget or income of $10 and that she can buy only two goods, apples or bananas. The price of an apple is $1.00 and the price of a banana is $0.50. For this consumer, the opportunity cost of buying one more apple is. Multiple Choice. A. 0.5 of a banana. B. 0.1 of a banana. C. 1 banana. D. 2 bananas.
20) Samir consumes apples and bananas and is in consumer equilibrium. The marginal utility of the last apple is 10 and the marginal utility of the last banana is 5. If the price of an apple is $0.50, then what is the price of a banana? A) $0.05 B) $0.25 C) $0.50 D) $1.00 E) $0.10 Answer: B
Denote the price of a bottle of sodas as Px and the price of a sandwich as Py. Denote the units of consumption in soda as X and in sandwiches as Y. The budget line function should be: PxX+PyY=I(income). Plug the prices and income into budget line function we get: BL1: X+2Y=12 BL2: 4X+2Y=12 . Hence we can draw BL1 and BL2 in our above graph.
A group of buyers and sellers of a particular good or service is called a (n) -economy. - coalition. -competition. -market. market. Other things equal, when the price of iron (a good) rises, the quantity demanded of iron (the good) falls, and when the price (of iron) falls, the quantity demanded (of iron) rises.".
There is a new study showing that consuming corn can be harmful for your health. The income of corn buyers falls, and corn is an inferior good. The price of corn rises. There is a new study showing that consuming corn can be harmful for your health.