Bu224 microeconomics assignment problem

Assignment Help Microeconomics

Reference no: EM132428343

BU224 Microeconomics, Purdue University

Question 1: a. Is Jane maximizing her utility? Explain your reasoning and show any calculations.

b. If Jane is not maximizing her utility, remembering the Law of Diminishing Marginal Utility, would she be better off to buy one less chicken sandwich and one moreorder of fries? Explain your reasoning and show any calculations.

c. If Jane is not maximizing her utility with the original purchase combination, remembering the Law of Diminishing Marginal Utility, would she be better off buying just one moreorder of fries? Explain your reasoning and show any calculations.

d. If Jane is not maximizing her utility with the original purchase, remembering the Law of Diminishing Marginal Utility, would she be better off buying one lessorder of friesand one more chicken sandwich? Explain your reasoning and show any calculations.

Question 2: a. Using the midpoint method, calculate the price elasticity of demand for Gondwanaland gosum berries. Explain what this price elasticity of demand means?

b. Complete the table below by calculating what the monthly average total revenue is for year 107, what the monthly average total revenue is for year 108, and the change in average total monthly revenue for these two years. How have these numbers changed?

c. Using your answer to part a. above, how could you have predicted the change in total monthly revenue that you found in part b. above?

Question 3: a. A 20% increase in the price of the Altair chariot will cause the quantity demanded to fall by an astounding 60%.

b. An increase in Gondwanaland consumers' incomes will cause prices to rise, but the total quantity demanded will also increase.

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Attachment:- Assignment_Template.rar

Reference no: EM132428343

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