Martha has $200 to spend on sneakers and sweaters. Sneakers cost $50 per pair and sweaters cost $20 each. She is thinking about buying 2 pairs of sneakers and 5 pairs of sweaters. She tells you that the additional utility that she would get from the second pair of sneakers is the same as the additional utility that she would get from the fifth sweater, i. e., the marginal utility of the second sneaker is equal to the marginal utility of the fifth sweater. Show that this bundle (2 sneakers and 5 sweaters) is not optimal. Tell her how she can increase her utility by reallocating her expenditures (while still spending the same amount in total, $200). Note that I am not looking for a specific numerical answer in terms of numbers of sneakers and sweaters. I want to know what she should buy more of and what less. Explain your answe
Answers: 1
Business, 22.06.2019 21:20
White truffles are a very prized and rare edible fungus that grow naturally in the countryside near alba, italy. suppose that it costs $200 per day to search for white truffles. on an average day, the total number of white truffles (t) found in alba is t = 20x − x 2 , where x is the number of people searching for white truffles on that day. white truffles can be sold for $100 each. if there is no regulation, how many more people will be searching for white truffles than the socially optimal number?
Answers: 1
Business, 22.06.2019 22:00
Which of the following is a function performed by market prices? a. market prices communicate information to buyers and sellers. b. market prices coordinate the decisions of buyers and sellers. c. market prices motivate entrepreneurs to produce those products that are currently most desired relative to their costs of production. d. all of the above are functions performed by market prices.
Answers: 2
Business, 22.06.2019 23:40
Martha is one producer in the perfectly competitive jelly industry. last year, martha and all of her competitors found themselves earning economic profits. if there is free entry and exit, what do you expect to happen to the number of suppliers in the industry and the price of jelly? the number of suppliers will increase, and the price of jelly will fall. the number of suppliers will decrease, and the price of jelly will increase. the number of suppliers will increase, and the price of jelly will increase. the number of suppliers will decrease, and the price of jelly will fall.
Answers: 3
Business, 23.06.2019 00:00
According to the video, the gross national product had declined from $104 billion in 1929 to about in 1933.
Answers: 2
Martha has $200 to spend on sneakers and sweaters. Sneakers cost $50 per pair and sweaters cost $20...
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