Diagram containing features of the consumer choice problem

Assignment Help Microeconomics
Reference no: EM13692290

The only goods that Angela consumes are wine (X) and chocolate (Y). On Tuesday the price of wine goes up, though at the same time, Angela's income increases by just enough so that she is equally happy (in utility terms) as she was on Monday.

A. What happens to the quantity of wine that Angela consumes between Monday and Tuesday? Use a diagram containing features of the consumer choice problem.

B. On Tuesday, would Angela still be able to afford the same basket that she purchased on Monday? How do you know?

On Wednesday there are no new price changes (so the Tuesday prices are still in effect), but Angela's income changes to the point where she can afford Monday’s basket.

C. Is Angela happier (in utility terms) on Wednesday or on Monday? Explain why.

Reference no: EM13692290

Questions Cloud

The price effect dominates the quantity effect : The Ford Motors Company estimates the elasticity of demand for its new truck as –1.12. Explain why the following statements are either true or false (i.e., state whether true or false and explain why.) The price effect dominates the quantity effect.
Explore causes and consequences of great recession : Normal 0 false false false EN-US X-NONE X-NONE Explore causes and conseque..
Dealing in drugs are not considered production : Officially, such activities as dealing in drugs are not considered production. Why not?
Diagram containing features of the consumer choice problem : The only goods that Angela consumes are wine (X) and chocolate (Y). On Tuesday the price of wine goes up, though at the same time, Angela's income increases by just enough so that she is equally happy (in utility terms) as she was on Monday.
Investment services offers free financial planning : Normal 0 false false false EN-US X-NONE X-NONE To generate leads for new b..
Amount can the bank lawfully credit to ralphs account : Ralph gets his paycheck from Shakes n’ Burgers Restaurant, his em­ployer, and attempts to deposit it in his account at Town Bank. Uri, the bank’s teller, notices that on the check the amount stated in words is different from the amount stated in nume..
Type of validity process is being violated criterion-related : If a non private company requires its employees to believe and pledge that they have Christian beliefs even if they are not Christians in order to be hired, which type of validity process is being violated criterion-related, construct, or content val..

Reviews

Write a Review

Microeconomics Questions & Answers

  Calculate the effective rate of protection

Calculate the effective rate of protection if there is no duty on steel imports.

  What proportion of variation in dependent variable is

in this project you are required estimate the demand for economy vehicles using the variables provided. the dependent

  Effect on the production possibilities frontier

Use a production possibilities frontier graph to illustrate the trade-off to an economy between producing consumption goods and producing capital goods.

  Suppose you own a taxi company in new york city assume

suppose you own a taxi company in new york city. assume further the taxi industry in nyc is described by a perfectly

  Describe difference between a normal good and inferior good

as an economist for abc plastics your boss has asked you to respond to some questions she has regarding the companys

  Compute risk premium and actuarially fair insurance premium

lewis and martin are successful comedians who get utility u from consumption c. they each have the same utility

  How to get the economy back on track

Some manufacturing companies are moving out of the country in search of cheap labor and the ones at home are not doing as good and some big ones like auto are trying to cope well after coming out of bankruptcy.

  Some economist think that 2008 economic recession and

some economist believe that the 2008 economic recession and financial crisis was caused by a perfect storm. explain

  Aggregate demand and supply

"Aggregate Demand and Supply" Please respond to the following: You have been hired as a consultant by your mayor to evaluate the increase in aggregate demand in the city where you live.

  What is the present worth of each project

Tempura, Inc., is considering two projects. Project A requires an investment of $58,000. Estimated annual receipts for 20 years are $25,000; estimated annual costs are $12,500.

  Explain the concept of externality in economics

Explain the concept of externality in economics? Give one example of a positive and a negative externality in Australia and what is Thorpe's marginal cost of GPA? Show and explain how his MC curve is derived.

  Does this mean that demand for the sedans slopes upward to

when the price of a top-of-the-line luxury sedan was 85000 there were 6184 sold. several years later when the price

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