Olga would prefer to have dinner with Alan than Bryan because Bryan wears sandals. She would prefer to have dinner with Bryan than Conan because Conan eats with his mouth open. Lastly, she would prefer to eat with Conan than Alan because Alan is too timid. Is Olga rational, in an economic sense? Briefly, why or why not?
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Olga would prefer to have dinner with Alan than Bryan because Bryan wears sandals.
She would prefer to have dinner with Bryan than Conan because Conan eats with his mouth
open. Lastly, she would prefer to eat with Conan than Alan because Alan is too timid. Is Olga
rational, in an economic sense? Briefly, why or why not? [
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- Ana and Ivan each individually and simultaneously decide whether to spend the evening at a play or a concert. Ana prefers to attend the concert twice as much without Ivan than to attend the play without him, and she prefers this three times more than being in the same place with Ivan (and at that point, she doesn't care where they are). Ivan prefers being in the same place with Ana twice as much as being at the play without her, and he prefers this four times more than being without Ana at the concert. Both have von Neumann-Morgenstern (vNM) preferences. With what probability will Ivan choose to attend the concert in Nashe's equilibrium?Suppose the National Football League (NFL) wants to make Super Bowl tickets affordable for more football fans. The league therefore sets the price of a Super Bowl ticket below what is generally considered a fair market price. Suppose the price of a ticket for a regular seat at the Super Bowl is set at just $500. People who have tickets, however, can turn resell them online for $2,500 each, or more. If there are no transaction costs associated with online sales of Super Bowl tickets, the true cost to a fan of attending the Super Bowl is: O at least $2,500. O the monetary price paid to obtain the ticket. at most $500. $2,000 less than the opportunity cost of a ticket.Suppose the National Football League (NFL) wants to make Super Bowl tickets affordable for more football fans. The league therefore sets the price of a Super Bowl ticket below what is generally considered a fair market price. Suppose the price of a ticket for a regular seat at the Super Bowl is set at just $500. People who have tickets, however, can turn resell them online for $2,500 each, or more. If there are no transaction costs associated with online sales of Super Bowl tickets, the true cost to a fan of attending the Super Bowl is:
- Ken and Daniel always eat miso soup and sushi in exact proportions: Ken eats one miso per two sushi; Daniel eats two miso per one sushi. They throw away any extra soup or sushi as it would not give them any pleasure. Once, they were stuck in the office together for hours, marking students’ assignments. Ken had ten miso soups and two sushi with him; Daniel had two miso and ten sushi. (For the purpose of this question, assume that miso and sushi can be divided into little pieces so one-half miso or one-hundredth of sushi makes sense) a) Draw the Edgeworth box for Ken and Daniel. Please put Ken at the origin and Daniel“upside down”; put miso on the horizontal axis and sushi on the vertical one. Show their endowment pointKen and Daniel always eat miso soup and sushi in exact proportions: Ken eats two miso per one sushi; Daniel eats one miso per one sushi. They throw away any extra soup or sushi as it would not give them any pleasure. Once, they were stuck in the office together for hours, marking students' assignments. Ken had one miso soup and 9 sushi with him; Daniel had 9 miso and one sushi. (For the purpose of this question, assume that miso and sushi can be divided into little pieces, so one-half miso or one-hundredth of sushi makes sense) a) Draw the Edgeworth box for Ken and Daniel. Please put Ken at the origin and Daniel "upside down"; put miso on the horizontal axis and sushi on the vertical one. Show their endowment point. b) Show all Pareto optimal allocations of miso and sushi between Ken and Daniel in the Edgeworth Box. You can use the graph from a). Please note that this question is a bit tricky, though not difficult. Draw a bunch of indifference curves and look for "tangencies".The country of Zanabar produces computers and produces them in a large quantity while the country of Abathana expertly produces cell phones in large quantities. In order for both countries to consume more desirable combinations of goods and services (computers and cell phones) they should Question 46 options: a) Each country should produce both computers and cell phones. b) allow only Abathana to trade a small quantity of cell phones for computers since cell phones are worth more. c) trade until each country has exactly equal number of cell phones and computers which will then create efficiency. d) freely trade computers and cell phones to improve allocative efficiency.
- The U.S. imports lumber among other goods from Canada. The lumber has been the topic of political dialogue between the 2 countries in the past few days. So let’s take X as ‘lumber’ and Y as ‘other goods’. Suppose the Canadian lumber and other exportable goods are produced with the following production Possibilities frontier (PPF): X2 + Y2 = 900 Suppose the U.S. utility function for the Canadian lumber, X, and other exportable goods, Y, is: U = X Y a. Derive the conditions necessary to determine the ‘Optimal Product Mix’ discussed in chapter 10. b. Draw the PPF (partial just the first quadrant) with Y on the vertical axis. On the same graph, draw at least one indifference curve so as to show the “optimal product mix’. Can this graph represent the ‘pure exchange’ economy? Explain why or why not. c. Now draw in a price line that can make the ‘optimal product mix’ a competitive exchange equilibrium. Can…Suppose that Ciana is deciding whether or not to buy a pair of sneakers that she has been researching online, and also the best place to make her purchase. Three different stores in the area sell the sneakers she likes, but some stores are more convenient for Ciana to reach than others. One option is her local shoe store located only 15 minutes away from where she works, where they charge a marked-up price of $124 for the sneakers: Store Travel Time Each Way Price of a Sneakers (Minutes) (Dollars per sneakers) Local Shoe Store 15 124 Different Neighborhood in Town 30 103 Rural Outlet 60 70 Ciana earns an hourly wage of $30 at her job. In order to purchase her sneakers she will have to take time off work, so each hour away from her job costs her $30 in lost income. Assume that Ciana’s travel time is the same each way (to and from the store) and that it will take her 30 minutes once she reaches a store to complete her shopping. Assume throughout the question…Carol and Bob both consume the same goods in an economy of pure exchange. Carol is initially endowed with 9 units of good 1 and 6 units of good 2. Bob is initially endowed with 18 units of good 1 and 3 units of good 2. They both have the utility function U(x₁, x₂) = = $1), what will the equilibrium price of x1/³x/3. If we set good 1 as the numeraire (so that p₁ good 2 be?
- Suppose that research finds a link between high fructose corn syrup (HFCS) and obesity, which then leads American consumers to switch from HCFS products to pure cane sugar products. The graphs below show the markets for cane sugar in Haiti and the U.S. before the studies were divulged. Shift the curves in the graphs, including the horizontal World Price curve, to describe the new trade equilibrium that results after the switch in preferences of American households, and then answer the follow-up question. Assume that the U.S. and Haiti are the only non-HFCS sugar trading parties in the world and that there are no quotas, subsidies, or tariffs distorting these markets. United States Haiti 8 1 Domestic Supply World Price DIE Domestic Demand 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Quantity (thousands of pounds) 8 According to your answer above, at the new equilibrium: Cane sugar producers in Haiti benefited. Cane sugar producers in the U.S. are worse off. All Haitian cane…Suppose that research finds a link between high fructose corn syrup (HFCS) and obesity, which then leads American consumers to switch from HFCS products to pure cane sugar products. The graphs show the markets for cane sugar in Haiti and the United States before the studies were divulged. Shift the curves in the graphs, including the horizontal world price curve, to describe the new trade equilibrium that results after the switch in preferences of American households, and then answer the follow-up question. Assume that the United States and Haiti are the only non-HFCS sugar trading parties in the world and that there are no quotas, subsidies, or tariffs distorting these markets. Price ($) Incorrect 10 9 8 7 3 2 1 World price United States Domestic demand Domestic supply 0 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Quantity (thousands of pounds) According to your graphs, at the new equilibrium ✓cane sugar producers in Haiti benefit. ✔all Haitian cane sugar consumers benefit.…Suppose that in an hour Chip can gather 8 pounds of fruit or 4 pounds of nuts. In an hour, Monk can gather 9 pounds of fruit or 3 pounds of nuts. Which of the following choices would benefit both Chip and Monk if trade occurred? Please choose the correct answer from the following choices, and then select the submit answer button. 1 pound of fruit for 2/5 pound of nuts 1 pound of fruit for 1 pound of nuts. 1 pound of fruit for 3/4 pound of nuts 1 pound of fruit for 1/10 pound of nuts I dont understand the math breakdown for these types of trade question I realize Chip Fruit to nuts is 2:1 and Monk is 3:1 but that is where I dont undersand the further breakdown