Ask Question, Ask an Expert

+61-413 786 465

info@mywordsolution.com

Ask Macroeconomics Expert

Question - You are in your first semester at college and deciding to spend your income between textbooks and food. You have $360 for the month. Textbooks are priced at $20 and food is priced at $10.

Your parents decide that they will assist you if you have to spend more than $150 total on textbooks by giving you $0.50 per dollar you spend on textbooks.

1. Draw the budget constraint for this rule.

a. We say that the budget constraint has a "kink". At what point does this kink occur?

b. What is the slope on either side of the kink in the budget constraint?

c. Draw an example set of utility functions for someone who would experience a substitution effect towards textbooks as a result of this rule.

2. Try and draw a budget constraint where both of these policies are active.

Macroeconomics, Economics

  • Category:- Macroeconomics
  • Reference No.:- M93118082

Have any Question? 


Related Questions in Macroeconomics

Principles of macroeconomics assessment - supply and demand

PRINCIPLES OF MACROECONOMICS ASSESSMENT - Supply and Demand, and Equilibrium Analysis Assume: Demand Curve: Q D = 80 - 10P; and Supply Curve: Q S = 10P 1. Using the above information, complete the schedules for Quantity ...

1explain four types of unemployment2explain the advantages

1. Explain four types of unemployment 2. Explain the advantages and disadvantages of:(a) A flexible exchange rate regime (b) A fixed exchange rate regime 3. Suppose the Reserve Bank of Australia increases the interest ra ...

Question prehistory no names or dates here the key

Question: Prehistory. No names or dates here. The key questions are how early human groups supported themselves; what kind of social, economic, and political institutions they developed to manage the resources of their e ...

Question - in a small town there is an extremely talented

Question - In a small town, there is an extremely talented baker. In a competitive market with other bakers, he faces a private marginal benefit (demand) curve of 200-Q. The marginal cost curve for producing the bread is ...

Question mandy has an income of 800 in period 1 and will

Question: Mandy has an income of $800 in period 1 and will have an income of $500 in period 2. Her utility function is U(c 1 , c 2 ) = c 0.80  c 0.20 , where c 1  is her consumption in period 1 and c 2  is her consumptio ...

Economics assignment -part a microeconomicsconsider the

Economics Assignment - Part A: Microeconomics Consider the following three sources. Source 1. Macquarie Analysis: Woolworths Trails Coles on Grocery Prices (by Catie Low) Source 2: Supermarkets Price War Source 3: Suppor ...

Production cost analysis and estimation applied problems

Production Cost Analysis and Estimation Applied Problems - Please complete the following two applied problems: Problem 1: William is the owner of a small pizza shop and is thinking of increasing products and lowering cos ...

Question franchise arrangements involve a number of highly

Question: Franchise arrangements involve a number of highly specific investments on the parts of both the parent company (e.g., McDonald's or Hilton Hotels) and the franchisee (the owner of a particular McDonald's or Hil ...

Question - how does strategic positioning benefit a firm

Question - How does strategic positioning benefit a firm? Discuss the importance of advertising, branding, and the effect of both on the product's demand curve.

Question this problem demonstrates how multiple regression

Question: This problem demonstrates how multiple regression models can be used to measure discrimination in labor markets. The data, taken from the 1991 Current Population Survey, contain information on wages, education, ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Why might a bank avoid the use of interest rate swaps even

Why might a bank avoid the use of interest rate swaps, even when the institution is exposed to significant interest rate

Describe the difference between zero coupon bonds and

Describe the difference between zero coupon bonds and coupon bonds. Under what conditions will a coupon bond sell at a p

Compute the present value of an annuity of 880 per year

Compute the present value of an annuity of $ 880 per year for 16 years, given a discount rate of 6 percent per annum. As

Compute the present value of an 1150 payment made in ten

Compute the present value of an $1,150 payment made in ten years when the discount rate is 12 percent. (Do not round int

Compute the present value of an annuity of 699 per year

Compute the present value of an annuity of $ 699 per year for 19 years, given a discount rate of 6 percent per annum. As