John’s MRS for reading books with watching movies is three movies per book regardless of the...

John’s MRS for reading books with watching movies is three movies per book regardless of the amounts consumed.

a. Would he rather read two books and watch no movies, or read no books and watch two movies?

	Read two books and watch no movies
	Read no books and watch two movies

b. What is the formula for his family of indifference curves?

	U = 3(Movies)(Books)
	U = Books + 3(Movies)
	U = 3(Books) + Movies
	U = Min {Books, Movies}

What do these curves look like?

	Upward sloping curves
	L-shaped
	Straight lines with a positive slope
	Straight lines with a negative slope

c. In this example, are movies and books perfect substitutes, perfect complements, or neither?

	Perfect substitutes
	Perfect complements
	Neither

Expert Solution

Rahul Sunny answered 2 years ago

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