Describe a budget constraint that would result in a kink. Draw the budget constraint, being careful...

Describe a budget constraint that would result in a kink. Draw the budget constraint, being careful to label all kink points with corresponding x and y values.

Expert Solution

Rahul Sunny answered 2 years ago

Draw and label a budget constraint and show it changing due to: A. An increase in...

Draw and label a budget constraint and show it changing due to: A. An increase in income B. A decrease in the price of the good on the horizontal axis.

Question 12 Draw the budget constraint for the representative consumer assuming that T > π. Draw...

Question 12 Draw the budget constraint for the representative consumer assuming that T > π. Draw in any changes if there is a reduction in π.

Draw an indifference curve that is tangent to the new budget constraint, and label the worker’s...

Draw an indifference curve that is tangent to the new budget constraint, and label the worker’s new choice of labor/leisure, and new total earnings, at a point that appears reasonable given convex preferences.

For each of the following, draw the indifference curves and budget constraint, and find the utility...

For each of the following, draw the indifference curves and budget constraint, and find the utility maximizing demands. Remember, don’t plug in the given prices and income until the end. u(x1,x2)=(x1)^2(x2), (p1,p2,m)=(1,2,10)

Draw two qualitative sketches—one showing how a worker’s budget constraint would be affected by a lump-sum...

Draw two qualitative sketches—one showing how a worker’s budget constraint would be affected by a lump-sum payment (such as a Universal Basic Income), the other showing how her budget constraint would be affected by the Earned Income Tax Credit (hint: check section 6.3). Use them to explain how the policies differ in their incentives regarding labor force participation for workers already choosing to work. b. Draw a second set of sketches identical to the first. Use them to explain how...

Detail the theory of budget constraint with an example of your budget constraint.

Suppose Betty’s budget constraint is described by the equation $400=5x1+10x2 Draw this budget equation? What is...

Suppose Betty’s budget constraint is described by the equation $400=5x1+10x2 Draw this budget equation? What is the slope of the budget line? Suppose now that the government places a tax of $2 per unit on good 2. Draw the new budget line? Suppose the tax is only for consumption over 10 units of x2. Now draw the budget line. Finally, suppose that the government decides to stick with the tax on x2 for consumption over 10 units, but it also...

app ?(?, ?) = ?? + ?, and the budget constraint ??? + ??? ≤ ?....

app ?(?, ?) = ?? + ?, and the budget constraint ??? + ??? ≤ ?. Assume throughout that all prices and quantities arepositive and infinitely divisible. Derive the consumer’s indirect utility function ?(∙). Then, derive the consumer’s expenditure function, e(∙), directly from ?(∙). Finally, derive the consumer’s Hicksian/compensated demand functions (denoted ? and ? , respectively) from e(∙).

Given a budget constraint and an indifference cure, draw a demand curve for product Y, assuming...

Given a budget constraint and an indifference cure, draw a demand curve for product Y, assuming X and Y are normal product.

Answer the following questions using the standard leisure-work choice model a)Draw a budget constraint for a...

Answer the following questions using the standard leisure-work choice model a)Draw a budget constraint for a worker has a job which pays a wage of $10.00 per hour. Draw an indifference map for typical worker. Assume that the worker is able to choose any number of hours of work and this worker’s optimal position is to work 8 hours a day. Show this point on your graph. b)Suppose the worker now receives $60 per day non-labor income. On your graph...

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