Consumer Theory and Horizontal Axis - 45363 Words

Chapter 2 1. A consumer prefers more to less of every good. Her income rises, and the price of one of the goods falls while other prices stay constant. These changes must have made her better of. TRUE 2. A decrease in income pivots the budget line around the bundle initially consumed. FALSE 3. If all prices are doubled and money income is left the same, the budget set does not change because relative prices don t change. FALSE 4. If all prices double and income triples, then the budget line will become steeper. FALSE 5. If good 1 is measured on the horizontal axis and good 2 is measured on the vertical axis, and if the price of good 1 is p1 and the price of good 2 is p2; then the slope of the budget line is ï ¿ ½Ã¯ ¿ ½p2=p1.†¦show more content†¦6. Edmund must pay $6 each for punk rock video casettes, V . If Edmund is paid $24 per sack for accepting garbage, G; and if his relatives send him an allowance of $168, then his budget line is described by the equation: (c) 6V ï ¿ ½Ã¯ ¿ ½ 24G = 168. 7. Edmund must pay $6 each for punk rock video casettes, V . If Edmund is paid $24 per sack for accepting garbage, G; and if his relatives send him an allowance of $192, then his budget line is described by the equation: (c) 6V ï ¿ ½Ã¯ ¿ ½ 24G = 192. 8. Eduardo spends his entire income on 12 sacks of acorns and 2 crates of butternuts. The price of acorns is 2 dollars per sack and his income is 34 dollars. He can just afford a commodity bundle with A sacks of acorns and B crates of butternuts which satisffies the budget equation: (b) 4A+ 10B = 68. 9. Harry thrives on two goods, paperback novels and bananas. The cost of paperback novels is 4 dollars each and the cost of bananas is 3 dollars per bunch.If Harry spent all of his income on bananas, he could afford 12 bunches of bananas per week. How many paperback novels could he buy if he spent all of his income on paperback novels?(c) 9 10. Heidi thrives on two goods: bananas and apples. The cost of bananas is 30 marks eac h and the cost of apples is 15 marks each. If her income is 210 marks, how many bananas can she buy if she spends all of her income on bananas? (b) 7 11. If she spends all of her income on lemons and tangerines, Isabella can just afford 30Show MoreRelatedKey to Success in Econ1648 Words   |  7 Pageswlang highlight mali un.. haha 1 Suppose that a consumer’s income triples. However, at the same time, both the price of and the price of also triple. This consumer has experienced Response: no change in purchasing power. * Edit Question 2 Suppose the price of is PhP20 and the price of is PhP10 and that good is plotted on the horizontal axis. If the price of doubles and the price of triples, leaving the consumer’s income unchanged, the budget line Response: will shift out from the origin. Read MoreManagement Models Of Management Model1203 Words   |  5 PagesFramework (CVF) and current examples demonstrating two models within the CVF. A simple search in Google or a quick browse through the library proves that vast models of management exist. Joan Magretta, author of What Management Is, describes models as theories that help managers â€Å"to see patterns, separate what matters from what doesn’t, to ask the right questions† (Magretta, 2002, p.10). Management models help address and solve issues that businesses face. Throughout history, well-known theorists suchRead MoreDemand Curve and Supply Curve2333 Words   |  10 Pagesaggregate supply. The AD-AS or Aggregate Demand-Aggregate Supply model is a macroeconomic model that explains price level and output through the relationship of aggregate demand and aggregate supply. It is based on the theory of John Maynard Keynes presented in his work â€Å"The General Theory of Employment, Interest, and Money†. It is one of the primary simplified representations in the modern field of macroeconomics and is used by a broad array of economists, from liber tarian, monetarist supporters of laissez-faireRead MoreQuestions on Consumers Budget1358 Words   |  6 PagesFigure 21-1. Assume that a consumer faces both budget constraints in graph (a) and graph (b) on two different occasions. If her income has remained constant, what has happened to prices? a. The price of X in graph (a) is higher than the price of X in graph (b). b. The price of Y in graph (a) is higher than the price of Y in graph (b). c. The prices of both X and Y are lower in graph (a). d. None of the above is true. ANS: A 3. Refer to Figure 21-1. Assume that a consumer faces the budget constraintRead MoreInnovation Within The World : Apple Iphone1684 Words   |  7 Pagesmore established manufacturers in a fast growing market. This allowed Apple to instantly place a stamp on the market with fresh, new touch screen technology that immediately appealed to consumers. Each adaptation was well received and progressed the technical capability and allowed them to drip feed the consumer with modest but tangible improvements. The iPhone evolved and the audience engaged with the developments that were made. The creator of the iPhone, Steve Jobs, can be summed up by the wordsRead MoreMicroeconomics/Macroeconomics Chapter 1 Questions and Answers5717 Words   |  23 Pagesto the long-term growth trend of the economy; also called business cycles. Use PowerPoint slide 22 for the following section The Science of Economic Analysis The Role of Theory: An economic theory is a simplification of economic reality that is used to make predictions about the real world. An economic theory captures the important elements of the problem under study. Use PowerPoint slides 23-26 for the following section The Scientific Method: A four-step process of theoretical investigation: Read MoreLeadership in the Retail Work Environment: Macys Case Study1312 Words   |  5 Pages4 jobs is retail oriented. As such the industry is very important in regards to economic growth and prosperity. In light of the current global economic downturn, retailers are realizing a decrease in discretionary spending on the part of consumers. Many consumers are spending less, saving more, deleveraging, and otherwise getting their personal balance sheets in order. This has caused some complications in regards to the overall work environment within the retail spectrum. One such example comes fromRead MoreThe Legacy Of Alfred Marshall1578 Words   |  7 Pagessciences in 1868. In 1885 he became professor of political economy at Cambridge where he remained until his retirement. Is important to highlight that Marshall founded the â€Å"Cambridge School† and the The topic studied were the increasing returns, the theory of the firm, and welfare economics. He published many of books including â€Å"Principles of Economics† and it was the dominant economic textbook in England for many years. In this we can mainly find the topic of supply and demand, marginal utility, andRead MoreReview Of Lucy Craymer, Us Demand Lifts Australian Beef Prices1511 Words   |  7 Pagestoo much longer, with the US slowly populating their cattle since the drought (Craymer 2015). Introduction The following essay discusses the economic theories in which the article relates to. The theories discussed in the article are demand and supply, economic efficiency, elasticity and total revenue. The following essay will discuss the theories in detail, concentrating on the response the market had to the demand and how they achieved equilibrium. Article Analysis Price Elasticity Total RevenueRead MoreInternal Auditor Essay1103 Words   |  5 Pagesallocate yourself 1.5 minutes per multiple choice question (i.e. a total of 30 minutes). This is NOT an open book exam. Choose the best answer from a), b), c), d) or e). Q1 Economics is the study of a) the share market and its effect on consumers and businesses b) money and how it is used by society * c) unlimited wants and limited resources d) unlimited resources and limited wants Q2 Which of the following does not illustrate opportunity cost? * a) If I study