--%>
Assignment Help - homework help

Problem on utility-maximizing bundle

Jane consumes only apples and chocolate.  She is always willing to trade 1piece of chocolate for exactly 3 apples. Her income is $200.  She can buy apples for $1 each and chocolate for $2 per piece.

a. To Jane, apples and chocolate are (circle 1):

  • Perfect complements
  • Perfect substitutes
  • Neither perfect complements nor perfect substitutes
  • Not enough information to tell

b. On the graph below, draw Jane’s budget constraint and several of her indifference curves. Illustrate her utility-maximizing bundle.

c. Jane’s local apple orchard has had a huge harvest. To try to sell more apples, they offer Jane a quantity discount. She still pays $1 per apple for the first 100 apples, but she can buy any additional apples beyond that for only $0.40 each.

Illustrate Jane’s new budget constraint and her new utility-maximizing bundle.

   Related Questions in Microeconomics

  • Q : Legal barriers to entry Patents are

    Patents are illustrations of: (a) legal economies of substitution. (b) legal barriers to entry. (c) natural barriers to entry. (d) marginal diseconomies of scale. Can someone explain/help me with best solution about problem of

  • Q : Illustration of Inferior Goods I have a

    I have a problem in economics on Illustration of Inferior Goods. Please help me in the following question. When the amount of a good your family purchases raises as your family income reduce, then the good is a/an: (i) Durable goods. (ii) Inferior goo

    		•
  • Q : Market Power and Demand for Labor All

    All of the given might causes labor markets to be non-competitive except: (i) Backward bending labor supply curves. (ii) Unions and employer trade associations. (iii) Monopolistic power exercised by the firm. (iv) Monopsonistic power exercised by the

    		•
  • Q : Lower value in the Gini index A lower

    A lower value for the Gini index tends to be related with: (w) increasing equality of the distribution of income or wealth. (x) decreases in the population’s total amount of income or wealth  (y) increased on the whole curvature of the Lore

    		•
  • Q : Profit or loss in purely competitive to

    When the wholesale price P = $5 per dozen roses, this purely competitive rose farm maximizes profit through producing ___ dozen roses at a total (loss or profit) of $___. (1) zero; loss; $2000. (2) 2000; loss; $1500.

    		•
  • Q : Marginal revenue by price elastic

    When a monopolist's demand is price elastic, in that case marginal revenue is: (w) positive. (x) negative. (y) zero. (z) independent of price elasticity. I need a good answer on the topic of Economics

  • Q : Potential advantage of Proprietorships

    Beth and Anna each own a florist shop. After many years of rivalry, they make a decision to team up and make a partnership. The potential advantage of such a union would be that: (1) They can divide up duties and become more proficient. (2) Their partnership profits n

    		•
  • Q : Present Value of Annual Interest Rate

    When the annual interest rate is 11 percent and a small office building can be expected to lease perpetually for price of $33,000 annually, the building and also the land it sits onto have a present value of approximately: (1) $363,00

    		•
  • Q : Social purposes served by firms I have

    I have a problem in economics on Social purposes served by firms. Please help me in the following question. The broad social purposes served by the firms do not comprise: (1) Coordination of team production. (2) Maximization of the stockholder gains. (3) Reduction of

    		•
  • Q : Determine total cost of

    This profit-maximizing competitive firm's total cost as TC=TFC+TVC, as in demonstrated figure can be calculated as area: (i) 0P3fq4. (ii) P2P1de. (iii) P3P2ef. (iv) 0P<

    		•