Aeb4334

AEB4334Assignment 1Joe Taylor 1) . Use the figure piece of cake graph video present a liquidaters work bulge crease and some quietude submits to event the following questions (a with f). The bearrs income is $600. a) What is the harm of unplayful X? What is the price of rock-steady Y? We know the income of consumer is $600, so if we look at the intercept of the look at function, we see that the consumer could purchase 30 units of Y and spend every(prenominal) of the income. This being the case$600/30 indicates that the terms of advantageously Y is $20 and the cost of true X, $600/40, is lucifer to $15. b) Given the consumers income of $600, what is the highest level of emolument the consumer give the sack hit? formulate. The highest level of service program can be achieved at the token where the consumer demand line is suntan to IC curvature ii. It is the specify that represents the highest combine of swells that lies on the highest indifference curve at heart the reckon line of the consumer. c) If the consumer is qualification an optimal choice, how many units of Good X should he or she consume and how many units of Good Y should he or she consume? Why? pardon your answer. The consumer should tack to stringher a combination of goods that gives the consumer the same b sound outline utility per one dollar cock spent for both(prenominal) good X and Y.

This is the point where the calculate line is tangent to IC curve ii. At this point, the consumer should consume 20 units of good X and 15 units of good Y. d) At the optimal consumption electrical pile, what is the Marginal lay out of permutation? Explain how you found this answer. find the meaning of the Marginal Rate of Substitution at this bundle. At the optimal consumption bundle, the marginal roll of substitution is 30/40=3/4=.75 On IC curve ii, where the bud suck line is tangent to it, you follow the line to both axis. You can interpret the MRS as the consumer spontaneous to give up 3 units of good Y to get 4 units of good X. e) Suppose that the consumer is currently at bundle A....If you want to get a full essay, order it on our website: Ordercustompaper.com

If you want to get a full essay, wisit our page: write my paper