Which is true of the two budget lines a X Line a has a higher nominal income than line b The absolute price of good Y is greater with budget line a than with budget line b Line b and line a have the same nominal income The price of good X is larger with budget line a

Which is true of the two budget lines a X Line a has a higher nominal income than line b The absolute price of good Y is greater with budget line a than with budget line b Line b and line a have the same nominal income The price of good X is larger with budget line a

Microeconomics: Principles & Policy

14th Edition

ISBN:9781337794992

Author:William J. Baumol, Alan S. Blinder, John L. Solow

Publisher:William J. Baumol, Alan S. Blinder, John L. Solow

Chapter4: Supply And Demand: An Initial Look

Section: Chapter Questions

Problem 7DQ

See similar textbooks

Related questions

Q: Required: Affiliate A sells 8,000 units to Affiliate B per year. The marginal Income tax rate for…

A: Interest rate refers to the percentage of the principal amount that a lender charges a borrower for…

Q: BlastCo Analytics needs to purchase a new metal shaper. BlastCo's after-tax MARR is 12% and the…

A: ModeFirst CostEconomic LifeAnnual Net SavingSalvage…

Q: When examining the terms; 'sales', 'purchases', 'quantity demanded', and 'quantity supplied' we…

A: Sales refer to the amount of goods or services that a company or individual sells to customers. It…

Q: While hyperinflations are always caused by rapid growth in the money supply, they can be intensified…

A: This concept can be defined as the speed of changing the hand of currency from one hand to another…

Q: Assume that the demand and supply curves are written mathematically as Qd = 14-2P Q8=2+4P What is…

A: Equilibrium refers to the situation in the market where demand equals the supply in the…

Q: Mary Singer borrowed $20,000 at an annual interest rate of 8% and paid off the loan, principal and…

Q: Long Run Costs curves [are | are not ] always U-shaped. One way to prove this is to look at…

A: LRAC depicts the lowest possible average production cost, allowing entire production inputs to vary…

Q: Suppose there are two goods beverage and pizza and two inputs land, T, and labor, Given atb=5001,…

A: In economics, a production function illustrates the relationship between the quantity of output…

Q: d. Using calculus and the equation that you found for P* in part c, find an expression for the tax…

A: Market equilibrium is a fundamental concept in economics that represents a state in a market where…

Q: The image below shows the condition of diminishing Marginal Rate of Technical Substitution (MRTS).…

A: Marginal rate of technical substitution is defined as the rate at which there can be a reduction in…

Q: 2. The following cash flows are equivalent in value if the interest rate is i. Which one is more…

A: An interest rate refers to the amount of interest due per period, as a proportion of the amount…

Q: You pay a plumber to install a new dishwasher in your home. Which statement is FALSE? a. You…

A: You pay a plumber to install a new dishwasher in your home. There is a trade of service and money…

Q: You and your partner have become very interested in cross-country motorcycle racing and wish to…

A: Present value is the value of investment in today's dollar. The present worth is the current value…

Q: Let’s consider the economics of waiting. The economic cost of waiting can be viewed from two…

A: Waiting can have economic costs for both Apple employees (internal customers) and external…

Q: 1. The farmer takes the rancher to court and the judge decides putting up a fence is the farmer's…

A: An externality is an idea from economics that alludes to the unintended side impacts or consequences…

Q: Consider two firms with the following marginal abatement costs (MAC) as a function of emissions (E):…

A: Externality is the External cost or benefit that is borne by the third party. When external cost is…

Q: "Social Security should be privatized to get the government out of the retirement-financing…

A: A descriptive statement that focuses on facts, data, and objective analysis is a positive statement.…

Q: Use the information given here to answer the following question. Sales revenue = Pm * Qm = 150…

A: The nominal rentals on land and capital are the actual amounts paid for the use of land and capital,…

Q: Patient cost sharing is now a permanent feature in almost all health insurance contracts. The…

A: Demand refers to the quantity that a consumer wishes to buy at a given price in given period of…

Q: It is the first of October, and you are developing cost estimates for creating an engineering…

A: Present worth, also known as present value, is a financial concept used to determine the current…

Q: Normally the selling price of a product, p, is related to the demand according to the following…

A: Total revenue is the multiplication of price and quantity demanded.Total revenue is maximized at a…

Q: Using calculus, show the effect of a change in the wage on the amount of leisure an individual wants…

A: Wage refers to the monetary compensation or payment that an employer provides to an employee in…

Q: Consider the graph at right. Assume that before any tax, firms were willing to supply 5 thousand…

A: At the equilibrium price, the quantity demanded is equal to the quantity supplied.Equilibrium occurs…

Q: 1.1 Calculate Q when L = 60 and K = 210 [1] 1.2 Calculate Q when both inputs are increased by 10%.…

A: Production function explains the units of output that can be produced by using all the quanntity of…

Q: If Dalene's marginal benefit from consuming another cookie is greater than the price of the cookie,…

A: Marginal benefit: It is the additional benefit received from consuming one more unit of a good or…

Q: 1. Determinants of the price elasticity of demand Consider the following list containing several…

A: Elasticity is defined as the responsiveness to change in one variable. When changes in price will…

Q: Refer to Figure 21-2. Which of the following statements is correct? a. Point V is unaffordable for…

A: Budget line is the line which shows different possible combination of two goods which a consumer can…

Q: 16 12 2 20 Reference Ref 4-13 40 OB. $50; $70.. OC. $30; $70 OD. $70; $280 60 (Figure: Determining…

A: A price ceiling is a government- or group-imposed price control, or limit, on how high a price is…

Q: QUESTION 1 The rational for cutting payroll tax during economic downturn is stated correctly by…

A: Payroll tax is defined as the tax paid by employers or employees. It is a flat-rate labor income…

Q: Refer to Figure 1. Assume Tom's budget constraint is AC. Given his current monthly income he will…

A: Budget constraint shows the relationship between the two goods, their prices and the income of the…

Q: The marginal costs (MC), average variable costs (AVC), and average total costs (ATC) for a firm are…

A: This can be defined as a tool that helps in the calculation of the revenue generated by the business…

Q: (Table: Production Function for Quinoa) Use Table: Production Function for Quinoa. Assume that the…

A: We have given the production function of Quinoa. 10-acre land and a tractor is a fixed input in the…

Q: What is the effect of a tariff on the market price? Select one: a. It keeps the price of the…

A: Tariffs refer to the tax imposed on items produced abroad and sold domestically. It results in an…

Q: Kim has taken a big step toward saving for her house. She has accumulated $56,750.00 for her down…

A: A government's purposeful efforts to influence economic growth are referred to as economic stimuli.…

Q: The following graph displays four demand curves (PP, QQ, RR, and SS) that intersect at point V.…

A: Price elasticity of demand measures the responsiveness of change in quantity demand to change in…

Q: Suppose a wealthy university booster has pledged a superstar high-school sophomore volleyball…

Q: QUESTION 1 Given a demand curve of P = 1200-40Qd and supply of P = 200 + 10Qs and a binding price…

A: Demand curve is downward sloping because as the price increase the quantity demanded decreases in…

Q: Question: This New Question – Only!!! Graph the demand curve?

A: The consumer utility function: Here qx is the quantity of good x and qy is the quantity of good y.…

Q: When the market price is $2 per pound, the consumer surplus is: PBANANAS (S/LB) $5.50 $3.00 $2.00 O…

A: The demand curve is the downward-sloping curve.The supply curve is the upward-sloping curve.The…

Q: The Central bank views unemployment just as important as A;Inflation B;The money supply

A: Unemployment occurs when someone is willing and able to work but does not have a paid job. The…

Q: Price GF m O 0 OB) G. C) D. BA OD) F Quantity S S In the graph, line S is the current supply of this…

A: Externality refer to the benefit or harm of an activity caused by any firm or an individual

Q: why you agree or disagree with the following statement: “Higher prices always yield higher…

A: Revenue alludes to the total income created by a business or organization from its essential…

Q: Can you explain how exchange rates are determined using the monetary and asset approach and draw…

A: The monetary approach to exchange rate determination emphasizes the role of money supply and demand…

Q: PS2(3)(a) Given: Consumer's Utility Function ? U= 4qx * * qy qx = Quantity Demanded for Goodx qy =…

A: From information,Equation for budfet line is: 10qx+5qy=60At optimum,MRS=px/py

Q: When the macroeconomic equilibrium is such that real GDP is less than potential real GDP, the…

A: Recessionary gap in economy refers to the situation occurs when real GDP is less than the potential…

Q: If the prices for goods A & B are $5 & $12, respectively, and a customer has $200, which basket of…

A: The limitation that a consumer faces in terms of spending on goods and services, subject to their…

Q: Consider the following utility functions: (1) u(T₁, T₂) = ₁ +2x2. (2) u(x1, 1₂) =21250.75 (3)…

A: The utility functions given are as follows.

Q: Social insurance: is not found in the U.S. would most likely provide more extensive…

A: Social insurance is a system of protection that uses public funds to provide benefits to individuals…

Q: In the long run, if the firm decides to keep output at its initial level, what will it likely do? O…

A: The following graph shows the short run average total cost curve and the long run average cost curve…

Q: The economic analysis of minimum wage involves both normative and positive analysis. Consider the…

A: The term positive economics implies objective analysis in the study of economics. Many economists…

Question

Which is true of the two budget lines
Y
a
X
Line a has a higher nominal income than line b
The absolute price of good Y is greater with budget line a than with budget line b
Line b and line a have the same nominal income
The price of good X is larger with budget line a

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1: Definition

VIEW

Step 2: Correct option

VIEW

Solution

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

As a general rule, is it safe to assume that a change in the price of a good will always have its most significant impact on the quantity demanded of that good, rather than on the quantity demanded of miller goods? Explain.
Explain all the reasons why a decrease in a products price would lead to an increase in purchases.
Show in the diagram ,what will happen to demand curve for normal goods when the is rise in price of substitute goods
10. Deriving demand from an indiference map Frances recently moved to San Diego, where they developed a taste for drinking Americanos and eating danishes. Assume throughout this problem that the price of an Americano is held constant at $3. On the following graph, the purple curves (I and I₂) describe two of Frances's indifference curves. The lines BC, and BC, represent bro budget constraints. Points X and Y show Frances's optimal consumption bundles subject to the budget constraints. AMERICANOS R2Xpe 16 14 DANISHES 12 14 ON 18 AK 20 Given the preceding graph and knowing the price of an Americano is $3, Frances's available income for Americanos and danahes is
. If average income increases, ceteris paribus, then there will be: A) a shift of the demand curve B) a movement along and a shift in the demand curve c) a movement along the demand curve D) no effect on the demand curve, because income is not a ceteris paribus condition
1. A substitute product is defined as a product that can be used for a similar purpose as theother product. The common example substitutes are butter and margarine. If the price ofbutter increases while that of margarine remain constant, use the demand curve toillustrate the effects of an increase in the price of butter to the demand for margarine.
Table 3.9 illustrates the market's demand andsupply for cheddar cheese. Graph the data and find theequilibrium. Next, create a table showing the change inquantity demanded or quantity supplied, and a graph ofthe new equilibrium, in each of the following situations:a. The price of milk, a key input for cheeseproduction, rises, so that the supply decreases by80 pounds at every price.b. A new study says that eating cheese is good foryour health, so that demand increases by 20% atevery price.
Suppose the linear demand curve for shirtsslopes downward and that consumers buy 500 shirts per yearwhen the price is $30 and 1,000 shirts per year when the priceis $25.a. Compared to the prices of $30 and $25, what can you sayabout the marginal valuation that consumers place on the300th shirt, the 700th shirt, and the 1,200th shirt they mightbuy each year?b. With diminishing marginal utility, are consumers derivingany consumer surplus if the price is $25 per shirt? Explain.c. Use a market demand curve to illustrate the change in consumersurplus if the price drops from $30 to $25.
a halving price of the prices of good A and Good B have the same effects on the budget line as doubling income. is this true or false and how woukld it look like using ana equation of a budget line
Course dash The substitution effect of a decrease in the wage will Lutfen birini seçin O a mcrease leisure only if leisure is a normal good Ob decreaseleisure only if leisure is a normal good. 0o increaceleisure, regardless of whetherleisure is a nomal orinfernor good. Od.decrease lasure regardless of whether lesureis anormnal ormferior good. AYFA SONRAKI
QUESTION 11 Jennifer, an accountant, is promoted at the company she works for. Therefore, her salary increases. We would expect Jennifer's demand for a. all the goods she purchases to remain unchanged. b. normal goods to decrease. C. inferior goods to decrease. d. substitute goods to increase. O a d. QUESTION 12 If Andrea's boss informs her that she will get a salary increase next month. Then a. her demand for all goods will increase next months b. her demand for normal goods will increase next months C. her demand for normal goods increases now d. her demand for all goods increases now O a O d a all gnswers. ОООО
Does an in income always shift income demand carves (for goods) to the right? why or why not?