What is lars''s new budget equation

Reference no: EM13177826

Lars consumes only potatoes and herring. When the price of potatoes was 9 crowns per sack and the price of herring was 5 crowns per crock, he spent his entire income to buy 5 sacks of potatoes and 10 crocks of herring per month. Now the government subsidizes potatoes. Market prices haven't changed, but consumers get a subsidy of 5 crowns for every sack of potatoes consumed. To pay for this subsidy, the government introduced an income tax. Lars pays an income tax of 20 crowns per month. If s is the number of sacks of potatoes and c is the number of crocks of herring, what is Lars's new budget equation?

Reference no: EM13177826

Questions Cloud

Calculate the amount of cheese that casper demands : Casper consumes cocoa and cheese. Cocoa is sold in an unusual way. There is only one supplier, and the more cocoa you buy from him, the higher the price you have to pay per unit. In fact y units of cocoa will cost Casper y2 dollars. Cheese is sold..

Explain who has the same preferences as jim : Jim's utility function is U(x, y) = xy. Jerry's utility function is U(x, y) = 1,000xy + 2,000. Tammy's utility function is U(x, y) = xy(1 - xy). Oral's utility function is U(x,y)= -1/(10+2xy).Marjoe's utility function is U(x, y) = x(y + 1,000). Pa..

Show that the preferred relation is transitive for mac : Mac Rowe doesn't sweat the petty stuff. In fact, he just cannot detect small differences. He consumes two goods, x and y. He prefers the bundle (x,y) to the bundle (x',y') if and only if (xy - x'y' > 1) . Otherwise he is indifferent between the tw..

Explain felicity is studying economics and political science : Draw a graph with pages of economics on the horizontal axis and pages of political science on the vertical axis. On this graph, show the possibilities that are consistent with the constraints that Felicity has imposed on herself. (She is allowed t..

What is lars''s new budget equation : Lars consumes only potatoes and herring. When the price of potatoes was 9 crowns per sack and the price of herring was 5 crowns per crock, he spent his entire income to buy 5 sacks of potatoes and 10 crocks of herring per month.

Calculate this manufacturer''s marginal cost for each output : For each level of output, calculate this manufacturer's marginal cost (MC) (For convenience, place the Marginal Cost between 0 and 1 boat on the second row, the Marginal Cost between 1 and 2 boats on the third row, and so on)

Calculate the variable cost for each level of output : For each level of output except zero output, calculate the average variable cost (AVC), average total cost (ATC), and average fixed cost (AFC) Qty of boats Total Cost Variable Costs Average Variable Costs Average Total Costs Average Fixed Costs 0 ..

Determine afc-avc-atc and mc for firm : What impact, if any, will this have the firm's AFC (average fixed cost), AVC (average variable cost), ATC (average total cost) and MC (marginal cost) and therefore these cost curves? Why?

Define the lorenz curve : Compared to the Gini coefficient for income distribution, the value of the Gini coefficient for the distribution of wealth would be,percent of families on the vertical axis and percent of income on the horizontal axis b. percent of families on the h..

User Account

All Pages