Assuming ceteris paribus (all other things being equal), discuss fully the effect of the following on a couple's demand for children and other goods: Increase in a couple's income Increase in the net price of children
Q: explain the difference between the following: complements and substitutes in production…
A: a) Complements and substitutes in production In production, complement goods are the goods that are…
Q: Because consumers purchase either Coke or Pepsi, economists call these “inferior” goods. Select…
A: Given: Consumer purchases either coke or pepsi thus it is inferior good.
Q: For each of the following pairs of goods, identify if they are substitutes or complements and use a…
A: Answer to the question is as follows:
Q: A consumer is in equilibrium at point A in the accompanying figure. The price of good X is $5. What…
A: The measure that depicts intersection of demand curve and supply curve in the economy is known as…
Q: For each of the following pairs, determine whether the goods are substitutes, compliments, or…
A: Substitute Goods= Those goods that can be used for same purpose are called substitute goods. For…
Q: Discuss fully the effect of each of the following to a couple’s demand for children and other goods.…
A: The demand curve shows the amount of goods and services that a consumer is willing to buy at…
Q: The price of tennis shoes is shown to depend on the price of rubber. Which of the following…
A: Answer: Correct answer: option 4 (An increase in rubber price potentially causes an increase in…
Q: Explain the difference between each of the following. (a) A consumption curve and a demand curve.…
A: Answer a. The demand curve shows the quantity that the consumer would purchase if the price of the…
Q: According to a recent study, "Stricter college alcohol policies, such as raising the price of…
A: A complementary good or service is an item used in conjunction with another good or service.…
Q: Zara perceives tea (vertical axis) and coffee (horizontal axis) as perfect substitutes, where she is…
A: Budget constraint shows the different possible combination of consumption of goods and services…
Q: A consumer must spend all of her income on two goods (X and Y). In each of the following scenarios,…
A: Goods can be divided into two categories based on the change in demand due to change in the income,…
Q: In terms of our shift variables of demand and supply, how are each of the following pairs related?…
A: Complementary goods are defined as those goods that complement each other that is, The rise in price…
Q: If both coffee and tea are normal goods and the price of coffee increases, it will increase the…
A: In case of normal goods, the law of demand applies which states that as price of the given good…
Q: According to statistics, people in their teens (15 years) will buy 12 CDs and 15 cheese pizza in a…
A: Answer: Present consumption of teens is 12CD and 15 pizzas. and cheese pizza is a secondary good for…
Q: Which of the following is an intermediate good? Question 14 options: A) the purchase of…
A: Bakery requires sugar as intermediary good to make cookies.
Q: In terms of our shift variables of demand and supply, how are each of the following pairs related?…
A: As wheat is used as a raw material in bread, an increase in the price of wheat makes the production…
Q: Which of the following is a determinant of demand? A) the price of a substitute goods B) the price…
A: In a market, there are various determinants of demand that have the ability to influence the…
Q: If the consumer’s income is held constant, how would the prices of goods X and Y have to change to…
A: A consumer can consume more of a commodity in two ways: either, his overall income increases -…
Q: Over the past decade, medical costs have increased more rapidly than other prices. In order to…
A: Since you posted multiple subparts, we will provide you with the answer to the first three…
Q: What is the ‘impact of a increase in the price of computer chips on the market for personal…
A: Correct : c. Micro, examining one sector of economy
Q: Which of the following events will increase the supply of sunscreen? If ________ and no other…
A: Given data, Change in supply When the producers or output of the suppliers of a specific good or…
Q: If electric cars and solar panels are complementary goods, an increase in the price of solar panels…
A: Goods which are consumed together are complementary goods.
Q: As the price of GOOD A increases by 20%, the quantity demanded of GOOD B increases by 10%. What is…
A: When the value of cross price elasticity is positive, it means that the two goods are substitutes…
Q: Muhammad's demand for fresh fish is perfectly income inelastic, and his income increases. If…
A:
Q: Which of the following is true regarding income along a price-consumption curve? A. Income is…
A: Price consumption curve depicts the change in quantity consumed as the price of good changes,…
Q: (In this question we denote income by Y, not by W as in the lecture notes). The following figure…
A: The correct alternative is Negative and dominates the substitution effect.
Q: Q3. Which of the following is the relation that the law of demand defines? a) Income and price of a…
A: Law of demand shows the inverse relation that exists between price of a good and quantity demanded…
Q: Why we need to estimate the economic prices of tradable goods? Kindly cite an example of a tradable…
A: Economic prices assist organizations with making due during seasons of monetary insecurity, as it…
Q: Suppose that you discover that, ceteris paribus, when the price of tomatoes increases, the demand…
A: Complementary goods - goods which are used together i.e. shocks right and left mobile and sim…
Q: Orange 10 Apple 5 6 9 Refer to figure. Suppose a consumer consumes 9 units of apple at the initial…
A: The quantity of an item required by consumers at a certain price for a specific period is referred…
Q: In terms of our shift variables of demand and supply, how are each of the following pairs related?…
A: a. Wheat and bread: Here, wheat is the main input for bread production. When wheat price increases,…
Q: Discuss the effect of each of the following to a couple’s demand for children and other goods: a.…
A: Demand is an economic concept that refers to a consumer's desire to buy products and services as…
Q: Consider the apple-juice market. Demand for apple-juice is given by: P = 66 - 4Qo and supply of…
A: Hi! Thank you for the question but as per the guidelines, we answer up to 3 subparts at a time.…
Q: What happens to demand for normal goods when income of people decrease
A: Demand is the total goods and services that the consumers are willing to buy at different prices.
Q: Carefully explain why an increase in the price of commodity X will not result, ceteris paribus, in a…
A: In a market, there are various determinants that influence the demand for a good such that income…
Q: What is the effect on the equilibrium price and quantity of orange juice of the following events if…
A: In general, when there is an excess supply of products or services, prices fall, resulting in…
Q: When due to rise in price of a good, total expenditure on the good also rises, then demand is…
A: # Depending upon the type of the demand the perticular good have, a rise or fall in price would…
Q: Rice is considered to be the staple food in the Philippines, so that when its price escalates,…
A: The staple food refers to that food which people of a specific place eat routinely. It is not same…
Q: 1950, a phone call at a pay phone cost 5 cents and a first-class stamp cost 3 cents. Today, those…
A: Cost is the trade worth of labor and products as far as cash. Cost of an item or administration…
Q: The following graph shows the market for pizzas in New York City, where there are over a thousand…
A: Supply of a commodity is the relationship between the price of the commodity and the willingness of…
Q: In terms of our shift variables of demand and supply, how are each of the following pairs related?…
A: “Hey, since there are multiple subpart questions posted, we will answer first three subpart…
Q: The mathematical equation that presents the inverse relationship of price and quantity that a…
A: Consumer theory studies the behaviors of consumers, how consumer spends their limited income given…
Q: In not more than six (6) sentences and assuming ceteris paribus (all other things being equal),…
A: Demand is the willingness and ability of a consumer to pay for a good or a service. Law of demand…
Q: of good is an example of Substitute goods:- (a) Fountain pen and ink (b) juice and cold drink (c)…
A: Substitute goods are those goods which can be used in place of one another as they have the same…
Q: In Mexico, NAFTA had the result of lowering the price of used cars. Consider the effect of the…
A: When the price of used cars in Mexico fell the Mexican demand for new cars decrease. This would…
Q: A change of which of the following will not directly shift the demand curve for Regular Coke?…
A: A shift in demand curve occurs when the quantity demanded of the good increases or decreases at the…
Step by step
Solved in 2 steps
- Discuss four (4) factors that affect an individual demand curve.Which of the following will cause a movement when looking at an individual’s demand curve? Price The Availability of Alternative Goods Tastes and Preferences Changes in incomeJulie buys food and other goods. She has an income of $400 per month. The price of food is initially $1.00 per unit. It then rises to $1.20 per unit. The prices of other goods do not change. To help Julie out, her mother offers to send her a check each month to supplement her income. Julie tells her mother, “Thanks, Mom. If you would send me a check for $50 per month, I would be exactly as happy paying $1.20 per unit as I would have been paying $1.00 per unit and not receiving the $50 from you.” Which of the following statements is true? Explain. The increased price of food has:a) an income effect of +$50 per monthb) an income effect of -$50 per month c) a compensating variation of +$50 per monthd) a compensating variation of -$50 per monthe) an equivalent variation of +$50 per monthf ) an equivalent variation of -$50 per month
- A consumer is choosing between magazines and books. His set of consumer optimums are shown on the graph to the right. 50 Consumer income allocated for these two goods is equal to $150. The price of 45 magazines (P,) is equal to $5.00. 40- How do these changes in the price of books affect the demand for magazines? 35- 30- 25 NN 20- demand remains constant 15- PCC demand increases 10- 5- demand decreases 0- Ó 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 Books étv 21 MacBook Air 80 DII F5 F6 F7 F8 F9 F10 F1 F2 F3 ! @ $ & * 1 2 3 4 6. 7 Q W E T U A S F H. J K L C V M option command command op ...- * C0 Magazines DA basket of goods for a given consumer includes two goods, X and Z. Consumer income is equal to $1,500 and the prices of these two goods are as follows: Px = $25 Pz = $25 This consumer is consuming10 units of good X. Suppose that over the course of a year, the price of good X changes by 10% and the price of good Z changes by −10%. How much income would be required for the consumer to afford the same quantity of goods X and Z with the new prices? $______Differentiate between normal goods and inferior goods
- A consumer is choosing between magazines and books. His set of čonsumer optimums are shown on the graph to the right. 50 Consumer income allocated for these two goods is equal to $150. The price of magazines (P,) is equal to $5.00. 45- 40 How do these changes in the price of books affect the demand for magazines? 35 demand remains constant 30- We can consider books and magazines to be goods. 25- 20- 15- PCC substitute 10- 5- complementary 0- O 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 unrelated Books O étv 21 MacBook Air DII 80 F10 F11 F7 FB F9 F6 F4 F5 F3 F1 F2 * @ # $ 7 8 9 1 2 4 P T Y Q W J K S F く Z C V command oF option command O 回 .. - つ エ B ** A.Explain the principles, concepts, and theories underlying individual consumers’ behaviour with respect to utility maximization.34) Consider Dianna who has a $25 fast food budget per month. She can purchase salads (S), hamburgers (H), or chicken strips (C). The price of a salad is Ps=$3, the price of a hamburger is PB-$2 and the price of chicken strips is Pc $4. Fill in the table below. You will use your solutions to answer questions 34-36. # Hamburgers # Salads 1 2 2 MU Salads 36 30 c) 4; 3; 4 d) 5; 4; 5 MU/P Salads 1 2 3 4 5 MU hamburgers 5 In the optimal consumption bundle for Dianna, she will purchase chicken strips. a) 2; 1; 2 b) 3; 2; 3 28 22 16 36) Dianna total utility from her consumption bundle is a) 126 b) 504 c) 106 d) 398 MU/P # Hamburgers Chicken Strips T 2 3 7 salads, 4 5 35) Dianna's utility is maximized where the marginal utility per dollar spent on each item is equal to a) $10 b) $12 c) $14 d) $16 MU Chicken Strips 72 64 56 48 40 hamburgers, and MU/P Chicken Strips
- The following graph shows the demand curve for a group of consumers in the U.S. market (blue line) for tablets. The market price of a tablet is shown by the black horizontal line at $120. Each rectangle you can place on the following graph corresponds to a particular buyer in this market: orange (square symbols) for Paolo, green (triangle symbols) for Sharon, purple (diamond symbols) for Van, tan (dash symbols) for Amy, and blue (circle symbols) for Carlos. Use the rectangles to shade the areas representing consumer surplus for each person who is willing and able to purchase a tablet at a market price of $120. (Note: If a person will not purchase a tablet at the market price, indicate this by leaving his or her rectangle in its original position on the palette.) Based on the information on the previous graph, you can tell that____will buy tablets at the given market price, and total consumer surplus in this market will be___ Suppose the market price of a tablet decreases…The following graph shows the demand curve for a group of consumers in the U.S. market (blue line) for tablets. The market price of a tablet is shown by the black horizontal line at $80. Each rectangle you can place on the following graph corresponds to a particular buyer in this market: orange (square symbols) for Larry, green (triangle symbols) for Megan, purple (diamond symbols) for Raphael, tan (dash symbols) for Susan, and blue (circle symbols) for Alex. Use the rectangles to shade the areas representing consumer surplus for each person who is willing and able to purchase a tablet at a market price of $80. (Note: If a person will not purchase a tablet at the market price, indicate this by leaving his or her rectangle in its original position on the palette.)Economists assume that consumers choose the best bundle of goods they can afford. True or false?
