What is his optimal consumption basket

Assignment Help Business Economics
Reference no: EM13997406

 Ben’s preferences are represented by the marginal rate of substitution MRS = 2y/x. His income is I = 180. The market prices are Px = 3 and Py = 1. What is his optimal consumption basket?

Reference no: EM13997406

Questions Cloud

What is the next lowest resonant frequency : Assume that a wire of linear density = 0.157 kg/m sustains a tension of 340 N as it is being stretched between two poles that are 18.4 m apart. Assume also that one end of the wire is fixed to one pole, while the other is connected to a ring which..
Discuss alfred north whitehead''s statement : Discuss Alfred North Whitehead's statement: "What is morality in any given time and place? It is what the majority then and there happen to like and immorality is what they dislike." Consider the following questions as guide: Businesses can have e..
If hospitals begin to affiliate within regions : If hospitals begin to affiliate within regions, would you expect that “unnecessary duplication of facilities” would increase, decrease or stay the same? Why is that? As you think about your answer, consider why this duplication exists in the first pl..
Real income has increased tremendously : Since 1900 real income has increased tremendously, yet the average number of children per family has decreased. Consider the following possible explanations and illustrate in terms of indifference curves and budget constraints of families between the..
What is his optimal consumption basket : Ben’s preferences are represented by the marginal rate of substitution MRS = 2y/x. His income is I = 180. The market prices are Px = 3 and Py = 1. What is his optimal consumption basket?
Compute the equilibrium price and the quantity of oranges : Suppose the demand curve for oranges is given by the equation. Compute the equilibrium price and the quantity of oranges
Conclusion about the profitability of increasing prices : To conduct an experiment, AMC increased movie ticket prices from $9.00 to $10.00 and measured the change in ticket sales. Using the data over the following month, they concluded that the increase was profitable. However, over the subsequent months, t..
The producer and consumer surplus in markets : What happens if you are willing to pay $80 to go to a concert, but the ticket prices are only $50. How does this affect the producer and consumer surplus in markets? Provide a detailed response.
Most heavily taxed items : Why are cigarettes and alcohol the most heavily taxed items in the US? Now, if the government increases the price of these items by 10%, how does this affect the stores that sell them? Provide a detailed response.

Reviews

Write a Review

Business Economics Questions & Answers

  Explain why the budget line can be called objective

Explain why the budget line can be called "objective" but an indifference curve is called "subjective." Explain why, if a consumer is to be in equilibrium, the marginal rate of substitution of good X for good Y must equal the negative ratio of the pr..

  Associated with a smoother adjustment process

Intra-industry trade may be associated with a smoother adjustment process than inter-industry trade because

  The expected rate of inflation

Elucidate how do your previous answers change in the special case where money demand does not depend on the expected rate of inflation

  Home country

Home Country: Given that the total market of the Home country is 900,000 units. Given the equations and parameter values above, solve for the equilibrium number of automobile companies, the number of cars each firm will produce, and the price of the ..

  Economy conducts expansionary fiscal and monetary policy

If the economy conducts expansionary fiscal and monetary policy, explain how this will influence the AD/AS model? Also, explain the implications of this type of policy on the overall economy using the model?

  Context of the basic market model we reviewed in class

Of the following, three mean the same thing and one means something different. Which option does not mean the same thing as the other three in the context of the basic market model we reviewed in class (and that you learned about in principles of mic..

  Explain greater consumer surplus

If the entry barrier is removed consumers will be better off because consumers will enjoy greater consumer surplus. Explain.

  You promise to cut tax rates increase transfers

You promise to cut tax rates, increase transfers and government purchases, reduce the governments budget deficit and reduce the governments debt as a fraction of the gdp. If elected, is it possible for you to keep all of your campaign promises.

  Amount that the economy is capable of producing

Whenever the amount of output produced is not as great as the amount that the economy is capable of producing, there is a positive GDP ___________ and cyclical unemployment will be the result.

  Catching illegal parkers is expensive

You have been appointed head of university parking enforcement. Your mission is to eliminate illegal parking. Car drivers are completely rational expected utility maximizes. They have utility functions given by u=x(1/2) where x is $ of consumption on..

  Explain why the higher real wage would fail to increase

Assuming that factor markets are otherwise free and competitive, explain why the higher real wage would fail to increase the share of labor income in national income.

  Label the axis and least two points on the budget line

A farmer’s field grows 30 bushels of corn and 10 bushels of beans. The farmer can either consume these crops herself or trade them, with one bushel of beans being traded for one bushel of corn. Graph the farmer’s budget which is the possible combinat..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd