Reference no: EM13853578
Assume Hailey's Utility Function is U = x^2 y . The price of X is $8 per unit and the price of Y is $2 per unit. Her income is currently $240 / month.
A) Determine her utility maximizing quantities of x and y.
B) Suppose the price of X goes down to $4 per unit. Determine her new utility maximizing quantities of x and y
C) Draw a graph of the utility maximizing quantities using Indifference Curves and Budget Lines. Label the price consumption curve.
D) You now have two points on Hailey's demand curve for x. Draw and label the demand curve. What is the elasticity of demand over this range of the demand curve?
4) Using the same utility function as in Question 3 and part a.
b) Suppose her income increases to $360 / month. Determine her new utility maximizing quanitites of x and y
c) Draw a graph of the utility maximizing quantities using Indifference Curves and Budget Lines. Label the income consumption curve.
d) You now have two points on Haileys Engel Curve for x. Draw and label the Engel Curve. What is the income elasticity of demand over this range of the curve?
|
Consumption expenditures and investment expenditures
: Suppose that consumption expenditures, investment expenditures, and government purchases are 75 billion, 25 billion and 20 billion, respectively. How large should the GDP be so that the net export is zero?
|
|
Relation between economic freedom and political freedom
: Discuss the summary below and include your thoughts, opinions, questions, observations, disagreements, etc. relating to the summary. The Relation between Economic Freedom and Political Freedom. There is an intimate connection between politics and eco..
|
|
Expect each to impact the demand for taxis
: At Dulles airport, only taxis and privately owned cars are allowed to use the highway between downtown and the airport. That taxi market is competitive. There is a special lane for taxis so they are always able to travel at 55mph. Suppose P,E and G c..
|
|
Experience diminishing marginal returns to labor
: In the short run, a firm cannot vary its capital, K = 2, but can vary its labor, L. It produces output q. Explain why the firm will or will not experience diminishing marginal returns to labor in the short run if its production function is
|
|
Determine her utility maximizing quantities
: Assume Hailey's Utility Function is U = x^2 y . The price of X is $8 per unit and the price of Y is $2 per unit. Her income is currently $240 / month. Determine her utility maximizing quantities of x and y. Suppose the price of X goes down to $4 per ..
|
|
Regardless of work or wage status-labor force participation
: Suppose the government were to provide a $2 per hour subsidy for families who purchases child care, regardless of work or wage status. This will.. Increase female labor force participation as take home pay for women will increase.
|
|
Produced in perfectly competitive industry
: Consider the following goods and services. Which are the most likely to be produced in a perfectly competitive industry? Which are not? Explain why you made the choices you did, relating your answer to the assumptions of the model of perfect competit..
|
|
Install the new lighting system if its cost does not exceed
: Suppose a human life is worth $10 million. Installing a better lighting system in the city park would reduce the risk of someone being murdered there from 3.5 to 2.9 percent over the life of the system. The city should install the new lighting system..
|
|
Calculating the amount added to each of gdps categories
: Category Amount:: Durable Goods $1,000, Non-Durable Goods 2,500, Services 7,000,Fixed Investment 1,800, Changes to Business Inventory 35, Investment in Stocks & Bonds 5,500, Federal Government Purchases 1,200. Using the above table determine the amou..
|