Any Macroecon nuts in here?

[galperi1]

I guess I'm just dumb, but I can't for the life of me figure out the answers to my homeworks problems. Can any of you genioses help me. Thanks


3. /solved

4. /solved

5. Julia decides how to allocate $30 of her monthly budget between movies and aerobics
classes. The price of a movie ticket is $6, while the cost of one aerobics class is $3.

(a) Draw Julia?s budget line (put movies on the horizontal axis, and aerobics classes on
the vertical axis). Assuming usual smooth and convex indifference curves show the
optimal allocation Julia should choose.
(b) Suppose that Julia does not know how to spend her money properly, and she allocates
it in a way that her MRS of movies for aerobics is 1. Show this allocation on the
diagram. How should Julia change her consumption bundle to maximize utility?
(c) Julia?s grandmother believes that doing sports is important for health, so she promises
Julia to pay for two aerobics classes she takes every month. Draw Julia?s new budget
line and her new optimal choice. Is Julia better off? Explain.
(d) How would Julia?s budget constraint change if her grandmother gave her $6 every
month instead of paying for aerobics classes? Compared to part (c), is Julia better
off? When would she be indifferent between the two options?

6. Trans-Continental Airlines (TCA) offers the following frequent flyer program to its customers:
For the first 30,000 miles flown each year, customers pay full fare. For the next
20,000 miles flown during the year, the fare is reduced by 20 percent; for all flights beyond
that, the fare is reduced by 50 percent. Sketch the budget constraint that faces a typical
TCA passenger. (Hint: the diagram will represent a situation where the consumer?s income
is allocated between flights and all other goods. Assume that the income of a typical
consumer is sufficiently high.)


Any help or explainations would be great. Thank you

 

[galperi1]

bump for serious help

 

[kt]

I'll help you out with question #3:

Draw a graph with x and y axis. x-axis represent hamburgers and y-axis represents beers.

a. A vertical line along the x-axis, where x > 0 and y > 0.
b. A straight line going out of x-y intersection with a ratio of 2:3, so go across 2 and up 3.
c. A 45 degrees straight line going out of x-y intersection with a ratio of 1:1, so go across 1 and up 1.
d. A horizontal line along the y-axis, where y = 0.

Now go read the book and figure out the rest.

 

[iwearnosox]

Do your own homework.

 

[Yossarian]

here is my indifference curve to your homework issues: ________________

 

[konichiwa]

this sounds more like microecon ...

 

[Eli]

ARG!

Everytime I read this thread title, I read it "Any macaroni nuts in here?".

 

[galperi1]

Originally posted by: kt
I'll help you out with question #3:

Draw a graph with x and y axis. x-axis represent hamburgers and y-axis represents beers.

a. A vertical line along the x-axis, where x > 0 and y > 0.
b. A straight line going out of x-y intersection with a ratio of 2:3, so go across 2 and up 3.
c. A 45 degrees straight line going out of x-y intersection with a ratio of 1:1, so go across 1 and up 1.
d. A horizontal line along the y-axis, where y = 0.

Now go read the book and figure out the rest.

thank you very much, that was very helpful.

To the rest, sorry I'm not the best student when it comes to micro econ.

 

[kt]

Originally posted by: konichiwa
this sounds more like microecon ...

No, it sounds macro...

 

[kt]

Originally posted by: galperi1

Originally posted by: kt
I'll help you out with question #3:

Draw a graph with x and y axis. x-axis represent hamburgers and y-axis represents beers.

a. A vertical line along the x-axis, where x > 0 and y > 0.
b. A straight line going out of x-y intersection with a ratio of 2:3, so go across 2 and up 3.
c. A 45 degrees straight line going out of x-y intersection with a ratio of 1:1, so go across 1 and up 1.
d. A horizontal line along the y-axis, where y = 0.

Now go read the book and figure out the rest.

thank you very much, that was very helpful.

To the rest, sorry I'm not the best student when it comes to micro econ.

More of a reason to read your course book. Honestly, when I took my first econ class I thought it was a waste of time. But I am sure glad I took it though.

 

[dquan97]

what does the book say about those problems? For me (BS in Econ), the book "usually" shows how to do it

 

[galperi1]

KT,

for #4 isn't he better off after the price change because if he only bought used books he would have $216 left over as opposed to 160$ before the price change?

 

[kt]

Originally posted by: galperi1
KT,

for #4 isn't he better off after the price change because if he only bought used books he would have $216 left over as opposed to 160$ before the price change?

Hey good job. I guess you finally cracked open the book, eh?

Yeah, he can't do any worse than breaking even with the extra amount he gets from his father. However, if he opt to get just one used book he will end up ahead. The more used book he decides to get, the more he ends up ahead.

 

[galperi1]

w00t, now if only I could figure out this demand curve thing. Part 5A is easy... except I don't think there is an optimal since all options total to her spending all 30$ of her dollars

 

[galperi1]

macro

 

[kt]

Originally posted by: galperi1
w00t, now if only I could figure out this demand curve thing. Part 5A is easy... except I don't think there is an optimal since all options total to her spending all 30$ of her dollars

hint: Read up on marginal utility.

 

[kt]

Originally posted by: galperi1
macro

Close, but no cigar. Read the hint I gave you in the PM I sent.