What is marvins optimal bundle, Microeconomics

Assignment Help:

Marvelous Marvin spends his money on muffins (m) and a composite good (c) (whose price you may assume is $1 throughout this problem). Marvin's utility is U = m + c and his income (I) is 20.

1. Suppose the price of muffins (pm) is 2. Draw Marvin's budget constraint and the highest indifference curve he can reach.

2. What is Marvin's optimal bundle?

3. Suppose that Marvin has the option of joining a muffin club for a membership fee of $10. Club members can purchase muffins for $0.40 each. Draw Marvin's budget constraint if he joins the club. Draw the highest indifference curve he can reach.

4. What is Marvin's optimal bundle (when he is a member of the club)?

5. Will Marvin choose to join the club? Why?

 


Related Discussions:- What is marvins optimal bundle

Total Product, Why total product continues to increase despite a decrease i...

Why total product continues to increase despite a decrease in the marginal product?

Increase probability or increase winnings, Would a risk loving person prefe...

Would a risk loving person prefer an increase in the chance of winning the lottery by 20% or an increase in the jackpot of 20%

Determinants of private demand - non-monetary benefits, Determinants of Pri...

Determinants of Private Demand - Non-Monetary Benefits Social status associated with university degrees is a determinant of investment decisions in higher education in the cas

Law of supply, what is the importance of law of supply

what is the importance of law of supply

Labor markets and labor Union, 1. Nonwage Determinants of Labor Supply Supp...

1. Nonwage Determinants of Labor Supply Suppose that two jobs are exactly the same except that one is performed in an air-conditioned workplace. How could you measure the value wor

Production, factors that affects the volume of production

factors that affects the volume of production

Define microeconomics concerned with its goal, a) Microeconomics is concern...

a) Microeconomics is concerned with decision-making within the firm, household or on the individual level, but macroeconomics is concerned with the behavior of the whole economic s

#titlenatural resourses.., what are the benefits of natural resources and i...

what are the benefits of natural resources and industryquestion..

., wHEN WAGE IS $6.05, HOW MANY HOURS ARE WORKED A WEEK?

wHEN WAGE IS $6.05, HOW MANY HOURS ARE WORKED A WEEK?

Write Your Message!

Captcha
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