Katie’s preferences for consumption and leisure can be expressed as U(C, L) = (C – 80) x (L – 40) This utility function implies that Katie’s marginal utility of leisure is C – 80 and her marginal utility of consumption is L – 40. There are 110 hours in the week available to split between work and leisure. Katie earns $15 per hour after taxes. She also receives $200 worth of assistance benefits each week regardless of how much she works. Graph Katie’s budget line. What is Katie’s marginal rate of substitution when L = 70 and she is on her budget line? What is Katie’s reservation wage?

just subparts a, b and c please

Consider an individual whose utility function is U(C, R) = 2C - (4 - R) 2 where R is the amount of leisure the consumer experiences per day. Suppose that the individual normally sleeps T hours a day, and they can spend the remaining hours between work and leisure. The individual receives an hourly wage of w > 0 and has also an income of Y > 0 a day from non - labour sources. The price of consumption goods is p per unit.

4. Steve's utility funetion over leisure and consumption is given by u(L,Y) = min (3L, Y). Wage rate is w and the price of the composite consumption good is p = 1. (a) Suppose w = 5. Find the optimal leisure - consumption combination. What is the amount of hours worked? (b) Suppose the overtime law is passed so that every worker needs to be paid 1.5 times their current wage for hours worked beyond the first 8 hours. Will this law induce Steve to work more hours? If so, how many? If not, explain.

A. Consider a consumer whose preferences can be represented by Cobb-Douglas utility function u(x₁, x₂) = xx where ₁ and 2 are the quantities of good 1 and good 2 she consumes. Let p₁ and p2 be the prices of good 1 and good 2 and let m denote her income. 1. Derive the consumer's Marshallian demand functions. 2. Derive the consumer's Hicksian demand functions. 3. Derive the consumer's expenditure function. 4. Let m = 20, P₁ = 2, and p2 = 1. Suppose that the price of good 1 drops to p₁ = 1. Find the following (a) Compensating variation (CV) (b) Equivalent variation (EV) (c) Change in consumer surplus (ACS) (d) Compare CV, ACS, and EV. 5. Let m = 120, P₁ = 1, and p2 = 1. Suppose that the price of good 1 increases to P₁ = 2. Find the following (a) Compensating variation (CV) (b) Equivalent variation (EV) (c) Change in consumer surplus (ACS) (d) Compare CV, ACS, and EV.

Consider two individuals, Carole and Mo, who each have a job opportunity that pays a wage of $20 per hour and allows them to choose the number of hours per week they'd like to work. Carole has stronger preferences for leisure than Mo. Ultimately, both Carole and Mo choose to work more than zero hours per week. Draw (and upload) one graph that includes: • Carole and Mo's income-leisure constraint • Carole's utility-maximizing indifference curve (Uc) and choice of leisure hours (Lc) • Mo's utility-maximizing indifference curve (UM) and choice of leisure hours (LM) [Note: There are multiple, though similar, ways to draw this graph. Focus on ensuring that the constraint, indifference curves and hours worked align with the information provided above.]

The utility of Amanda for leisure (L) and income (Y) is U = LY. The price of income is 1. If Amanda uses her spare L hours a day, (24 - L) hours will be labored. Since wages are w, the daily income is (24 - L). If the wages are positive, show that the optimal number of leisure hours that Amanda will use will always be the same. How much leisure time does Amanda demand and how much work time do she want to provide?

Consider a worker who consumes one good and has a preference for leisure. She maximizes the utility function u(x, L) = xL, where a represents consumption of the good and L represents leisure. Suppose that this worker can choose any L € [0, 1], and receives income w(1 – L); w represents the wage rate. Let p denote the price of the consumption good. In addition to her wage income, the worker also has a fixed income of y ≥ 0. (a) Write down the utility maximization problem for this consumer. Solution: The problem is max x L s.t. px ≤w(1 L) + y. x>0, LE [0,1] The budget constraint may also be written with equality since preferences are monotone. (b) Find the Marshallian demands for the consumption good and leisure. Solution: Using FOCs will find the maximum since preferences are Cobb-Douglas (and therefore convex). Dividing the FOCs L= Xp and x = Xw gives wL = px. Substituting into the budget constraint and checking the restriction L = [0, 1], we get and x(p, w, y) L(p, w, y) = = = 1 w+y…

Kevin has a wage income of $10,000 in the present and $15,000 in the future.  His utility is given as U = min (4cp, 5cf), where cp denotes consumption today and cf consumption in the future.  The relevant interest rate is 10%. ​ a. If the interest rate were to increase to 15 percent,would Kevin be better off or worse off?  Explain. b.​ Find two measures to indicate how much better off or worse off Kevin is as a result of the increase in interest rates.  Explain.

2nd attempt See Hint A consumer faces a tradeoff between labor (L) and leisure (R). She consumes a composite good (C). When the consumer works, she earns an hourly wage of $15.00, and she spends a maximum of 24 hours on labor and leisure, but she chooses to work 10.00 hours. Whatever time she does not spend working, she spends on leisure. She starts with an initial endowment of 11.00 units of the composite good, which she can buy and sell freely at a market price of $4.00. Given this information, what is the consumer's real wage? $ 194