EBK MICROECONOMICS
5th Edition
ISBN: 9781118883228
Author: David
Publisher: YUZU
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Question
Chapter 5, Problem 5.28P
To determine
(a)
To calculate:
The budget constraint based on an optimal choice diagram.
To determine
(b)
A set of indifference curve is to be drawn which makes it optimal for a consumer to work 4 hours of overtime each day.
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Students have asked these similar questions
Bessie, who can currently work as many hours as she wants at a wage of w, chooses to work 10
hours a day. Her boss decides to limit the number of hours that she can work to 8 hours per day.
Show how her budget constraint and choice of hours change.
Bessie's budget constraint L is illustrated in the figure to the right.
For completing the following, assume the indifference curves satisfy the usual assumptions.
1.) Use the 3-point curved line drawing tool to draw an indifference curve for Bessie when she can
work as many hours as she wants. Label this curve '¹'.
2.) Use the 3-point curved line drawing tool to draw an indifference curve representing Bessie's
utility when she is restricted to work 8 hours per day. Label this curve 'IR¹.
Carefully follow the instructions above, and only draw the required objects.
Y, Goods per day
(-1,19.3)
Time constraint
10
8
L, Leisure hours per day
G
[
What is the concept of diminishing marginal utility of consumers? How consumer use Marginal Rate of Substitution to reach consumer equilibrium level where MRTS = Px/Py?
Consider the optimal choice of labor and leisure discussed in class and the text. Suppose a consumer works the first 8 hours of the day at a wage rate of $10 per hour, but receives an overtime wage rate of $20 for additional time worked.
a. On an optimal choice diagram, draw the budget constraint. (Hint: it is not a straight line.)
b. Draw a set of indifference curves that would make it optimal for him to work 4 hours of overtime each day.
Pls solve both for upvote
Chapter 5 Solutions
EBK MICROECONOMICS
Ch. 5 - Prob. 1RECh. 5 - Prob. 2RECh. 5 - Prob. 3RECh. 5 - Prob. 4RECh. 5 - Prob. 5RECh. 5 - Prob. 6RECh. 5 - Prob. 7RECh. 5 - Prob. 8RECh. 5 - Prob. 9RECh. 5 - Prob. 10RE
Ch. 5 - Prob. 5.1PCh. 5 - Prob. 5.2PCh. 5 - Prob. 5.3PCh. 5 - Prob. 5.4PCh. 5 - Prob. 5.5PCh. 5 - Prob. 5.6PCh. 5 - Prob. 5.7PCh. 5 - Prob. 5.8PCh. 5 - Prob. 5.9PCh. 5 - Prob. 5.10PCh. 5 - Prob. 5.11PCh. 5 - Prob. 5.12PCh. 5 - Prob. 5.13PCh. 5 - Prob. 5.14PCh. 5 - Prob. 5.15PCh. 5 - Prob. 5.16PCh. 5 - Prob. 5.17PCh. 5 - Prob. 5.18PCh. 5 - Prob. 5.19PCh. 5 - Prob. 5.20PCh. 5 - Prob. 5.21PCh. 5 - Prob. 5.22PCh. 5 - Prob. 5.23PCh. 5 - Prob. 5.24PCh. 5 - Prob. 5.25PCh. 5 - Prob. 5.26PCh. 5 - Prob. 5.27PCh. 5 - Prob. 5.28PCh. 5 - Prob. 5.29PCh. 5 - Prob. 5.30PCh. 5 - Prob. 5.31PCh. 5 - Prob. 5.32PCh. 5 - Prob. 5.33P
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