Microeconomics

Complete the following problems from your text: * Chapter 5: Applied sire 1 * Bridget has a limited income and consumes only vino and break-dance up; her current consumption weft is four bottles of wine and 10 pounds of quit. The price of wine is $10 per bottle, and the price of give up is $4 per pound. The last bottle of wine added 50 units to Bridgets service program, time the last pound of cheese added 40 units. * a. Is Bridget making the utility- maximising choice? Why or why non? $10 x 4 bottles = $40 $4 x 10 pounds =$40 Total of $80 spent MRS = MUX/PX = MUY/PY MRS=50U/10=$5 wine MRS=40U/4=$10 cheese MUX/P is less than MUy/P; therefore Bridget is not maximizing the utility-maximizing choice. * b. If not, what should she do instead? Why? According to our text, the consumer should reallocate disbursement on X and Y in pasture to outgrowth utility while spending the same amount of gold ($80) (Thomas, 2011). * Chapter 6: Applied Probl em 1 * In an condition slightly the financial problems of USA Today, Newsweek reported that the pa- per was losing about $20 jillion a year. A groin Street psychoanalyst name that the paper should pass on its price from 50 cents to 75 cents, which he estimated would bring in an additional $65 million a year.

The papers newspaper publisher rejected the idea, saying that circulation could throw sharply by and by a price improver; citing The Wall Street Journals experience after it change magnitude its price to 75 cents. What implicit assumptions be the publisher and the analyst making about price sho t? The implicit assumptions make by the ana! lyst are that the stylus to help resign the financial problems of USA Today is to raise the price by 25cents. According to our text if a ships company raises the price of a product, the total revenue will subjoin if the metre exchange remained the same (Thomas, 2011). He does not manoeuvre into consideration that the quantity sold could decrease and not supply the expected revenue. The publisher is making the...If you want to get a full essay, order it on our website: BestEssayCheap.com

If you want to get a full essay, visit our page: cheap essay