Derive a demand function, Microeconomics

Zac consumes only pizza and chianti. He consumes these goods in fixed proportions: 2 slices of pizza for one glass of chianti. His income is $100 per week.

a. Derive demand functions forpizza and chianti. Are the goods normal or inferior, substitutes or complements?

b. If pizza costs $1 per slice and chianti $3 per glass, how much of each good will he consume?

c. If the price of pizza falls to $0.5 per slice and, chianti stays at $3 per glass, how much of each good will Zac consume?

d. Using a suitably labelled diagram with pizza on the horizontal axis, illustrate the impact of the change in price of pizza from $1 to $0.5 per slice. Show the level of utility before and after the price change and show the decomposition line.

Posted Date: 3/30/2013 6:14:55 AM | Location : United States







Related Discussions:- Derive a demand function, Assignment Help, Ask Question on Derive a demand function, Get Answer, Expert's Help, Derive a demand function Discussions

Write discussion on Derive a demand function
Your posts are moderated
Related Questions

draw a production possibility frontier task using the graph and value and identity the pareto efficent and inefficient point and the marginal oppotunity cost of x for each point of

Why some country saving less and consumption more?

the basics in micro economics


Q. Explain General Equilibrium? General Equilibrium: Neoclassical economics presumes that production, employment, investment and income distribution are all determined by a con

what is rational decision and why it requires one''s choices be consistent with one''s goals?

define perspective of managerial economics.

MRP Technique- Sectoral Distribution of Targeted Increase in GDP There are two ways of increasing the GDP: (i) Project and accomplish the growth in various sectors through

On what kind of income is our taxing system based?