3) For Nour doughnuts and muffins are perfect substitutes. Doughnuts are £4 a box and muffins are £3 a box. The boxes hold equal numbers. Nour has budgeted £48 a month to spend on these sweets. Which of the following is correct? (a) Nour will buy 12 boxes of doughnuts and no muffins per month. (b) Nour will buy 6 boxes of doughnuts and 8 boxes of muffins per month. (c) Nour will buy no doughnuts and 16 boxes of muffins per month. (d) From this information it cannot be determined how many muffins or doughnuts Nour will buy because the marginal utilities for muffins and doughnuts are not given.

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
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Chapter1: Making Economics Decisions
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3) For Nour doughnuts and muffins are perfect substitutes. Doughnuts are £4 a box
and muffins are £3 a box. The boxes hold equal numbers. Nour has budgeted £48 a
month to spend on these sweets. Which of the following is correct?
(a) Nour will buy 12 boxes of doughnuts and no muffins per month.
(b) Nour will buy 6 boxes of doughnuts and 8 boxes of muffins per month.
(c) Nour will buy no doughnuts and 16 boxes of muffins per month .
(d) From this information it cannot be determined how many muffins or doughnuts
Nour will buy because the marginal utilities for muffins and doughnuts are not given.
4) The supply of sugar is given by Q, = -50 + 1/2 P. Determine the arc price elasticity
of supply between Q = 40 and Q = 100.
(a) 7/12.
(b) 2.
(c) 12/7 .
(d) 3/28.
(e) None of the above.
Transcribed Image Text:3) For Nour doughnuts and muffins are perfect substitutes. Doughnuts are £4 a box and muffins are £3 a box. The boxes hold equal numbers. Nour has budgeted £48 a month to spend on these sweets. Which of the following is correct? (a) Nour will buy 12 boxes of doughnuts and no muffins per month. (b) Nour will buy 6 boxes of doughnuts and 8 boxes of muffins per month. (c) Nour will buy no doughnuts and 16 boxes of muffins per month . (d) From this information it cannot be determined how many muffins or doughnuts Nour will buy because the marginal utilities for muffins and doughnuts are not given. 4) The supply of sugar is given by Q, = -50 + 1/2 P. Determine the arc price elasticity of supply between Q = 40 and Q = 100. (a) 7/12. (b) 2. (c) 12/7 . (d) 3/28. (e) None of the above.
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