Suppose commodities can be separated into housing (in amount x) and a general commodity representing all...

Suppose commodities can be separated into housing (in amount x) and a general commodity representing all other goods (in amount z). Suppose a family has utility functionU(x,z) = z4/5x1/5And a monthly income of $500. The government wishes this family to live in a house that rents for at least $150. Suppose the prices are each $1.00 per unit.a.Without any subsidy, how much will the family spend on rent?b.Under each of the plans above, how much subsidy would be required to induce the family to live in a $150 house

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Rahul Sunny answered 2 years ago

Suppose you allocate all your wealth to “housing” and “savings”. Housing costs $40 per square foot....

Suppose you allocate all your wealth to “housing” and “savings”. Housing costs $40 per square foot. You have $100,000 in wealth and have elected to build a 1000 square foot house. Draw your budget line between housing (on the horizontal axis) and savings (on the vertical). Draw the indifference curve you are on. Now suppose the price of housing falls to $30 per square foot. (Do not forget that you already bought a 1000 square foot house!) Draw your new...

Suppose you allocate all your wealth to “housing” and “savings”. Housing costs $40 per square foot....

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Suppose an inflationary economy can be described by the following equations representing the goods and money...

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Suppose that the amount of sugar in a can of Pepsi is normally distributed with mean...

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Suppose commodities can be separated into housing (in amount x) and a general commodity representing all...

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Suppose you allocate all your wealth to “housing” and “savings”. Housing costs $40 per square foot....

Suppose you allocate all your wealth to “housing” and “savings”. Housing costs $40 per square foot....

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