what does the point represent where the budget constraint and the indifference curve touch?
what does the point represent where the budget constraint and the indifference curve touch?
Homework Answers
When the budget constraint and the indifference curve touch then this point shows the level at which the utility is maximum.
At this point,the indifference curve is tangent to the budget line.At this point,the consumer will get maximum satisfaction from the given budget and consumption.
Add Answer to:
what does the point represent where the budget constraint and
the indifference curve touch?
In the following budget constraint- indifference curve graph, Nikki has $150 to spend on blouses and...
In the following budget constraint- indifference curve graph, Nikki has $150 to spend on blouses and skirts a. What is the price of a blouse? What is the price of a skirt? b. Is Nikki making the optimum choice if she buys 4 blouses and 2 skirts? Blouses O A. Yes, this point is on the budget constraint OB. No, the indifference curve going through this point is not tangent to Nikki's budget constraint OC. No, the other point of...
The point where the indifference curve is tangent to the budget line A. is a point...
The point where the indifference curve is tangent to the budget line A. is a point on consumer's demand curve. B. is the best affordable point. C. is where the marginal rate of substitution exceeds the relative price by as much as possible. D. All of the above answers are correct.
True, False, Uncertain or Not enough information: A given budget constraint has only one indifference curve...
True, False, Uncertain or Not enough information: A given budget constraint has only one indifference curve that is tangent for a specific set of prices. However, there may be numerous indifference curves that intersect the same budget constraint. Explain in terms of relative prices, opportunity costs and the marginal rate of substitution.
On the budget constraint and indifference curve diagram (click on it to make it bigger), if...
On the budget constraint and indifference curve diagram (click on it to make it bigger), if DK is the original budget line and DF is the new budget line, then which of the following must have happened to cause the move from DK to DF? The price of hot dogs must have risen. The price of Cokes must have fallen. None of the other answers is correct. The price of Cokes must have risen. The price of hot dogs must...
) What does the indifference curve represent? ii) What is CAL(P)? iii) What is the efficient...
) What does the indifference curve represent?
ii) What is CAL(P)?
iii) What is the efficient frontier of risky assets?
iv) Explain what the point C represents.
v) How can an investor access pointK?
(c) Outline and discuss three limitations of the CAPM.
(b) Consider the following graph: CAL(P) E(R) Indifference curve Efficient frontier of risky assets Optimal risky portfolio Expected return (%) Standard deviation (%)
if an individuals indifference curve map does not obey the assumption of a diminishing MRS, then...
if an individuals indifference curve map does not obey the assumption of a diminishing MRS, then tangencies of indifference curves to the budget constraint may not be points of utility maximization. True or false. Explain very Brief
A) Suppose U = min[X, 3Y] and I=12, Px=1 and Py=5. Find X* and Y*. B) Draw an indifference curve and a normal linear budget constraint such that there is a tangency point (where MRS= price ratio) that...
A) Suppose U = min[X, 3Y] and I=12, Px=1 and Py=5. Find X* and Y*. B) Draw an indifference curve and a normal linear budget constraint such that there is a tangency point (where MRS= price ratio) that is not the optimal bundle. C) Suppose U=X∙Y5. Find X* and Y*. D) Suppose U = 5∙X + 2∙Y and I=12, Px=2 and Py=1. Find X* and Y*.
optimal consumption & budget constraint
Q1. A consumer chooses an optimal consumption point where the A) marginal rate of substitution equals the relative price ratio. B) slope of the indifference curve exceeds the slope of the budget constraint C) ratios of all the marginal utilities are equal D) All of the above are correct. Q2. A budget constraint illustrates the A) prices that a consumer chooses to pay for products he consumes. B) consumption bundles that give a consumer equal satisfaction. C) purchases made by consumers. D) consumption bundles that a consumer can afford
7. Consider the figure below, which shows the budget constraint and the indifference curves of good...
7. Consider the figure below, which shows the budget constraint and the indifference curves of good King Zog. Zog is in equilibrium with an income of s300, facing prices px 4 and py sio 30 22.5 0 35 43 75 90 a. How much X does Zog consume? b. If the price of X falls to s2.50, while income and the price of Y stay constant, how much X will Zog consume? c. How much income must be taken away...
The graph shows Tom’s budget line and indifference curve for good x and y. The price...
The graph shows Tom’s budget line and indifference curve for good x and y. The price of good x is $40 . If he uses all of his income on good Y , then 20 units of y will be consumed. If all income is spent on good x then 4 units will be consumed. What is the marginal rate of substitution of good y for x at the point where the indifference curve is tangent to the budget line?
In the following budget constraint- indifference curve graph, Nikki has $150 to spend on blouses and skirts a. What is the price of a blouse? What is the price of a skirt? b. Is Nikki making the optimum choice if she buys 4 blouses and 2 skirts? Blouses O A. Yes, this point is on the budget constraint OB. No, the indifference curve going through this point is not tangent to Nikki's budget constraint OC. No, the other point of...
On the budget constraint and indifference curve diagram (click on it to make it bigger), if DK is the original budget line and DF is the new budget line, then which of the following must have happened to cause the move from DK to DF? The price of hot dogs must have risen. The price of Cokes must have fallen. None of the other answers is correct. The price of Cokes must have risen. The price of hot dogs must...
) What does the indifference curve represent?
ii) What is CAL(P)?
iii) What is the efficient frontier of risky assets?
iv) Explain what the point C represents.
v) How can an investor access pointK?
(c) Outline and discuss three limitations of the CAPM.
(b) Consider the following graph: CAL(P) E(R) Indifference curve Efficient frontier of risky assets Optimal risky portfolio Expected return (%) Standard deviation (%)
7. Consider the figure below, which shows the budget constraint and the indifference curves of good King Zog. Zog is in equilibrium with an income of s300, facing prices px 4 and py sio 30 22.5 0 35 43 75 90 a. How much X does Zog consume? b. If the price of X falls to s2.50, while income and the price of Y stay constant, how much X will Zog consume? c. How much income must be taken away...
Most questions answered within 3 hours.
-
Where is the error in this code sequence?
String s1 = "Hello";
String s2 = "ello";...
asked 10 months ago -
Financial data for Joel de Paris, Inc., for last year
follow:
Joel de Paris, Inc.
Balance...
asked 10 months ago -
Consider this reaction:
Al2(SO4)3 (aq)+ BaCl3
(aq) Al2Cl6 (aq)- +
3BaSO4(s) . What is the...
asked 10 months ago -
Suppose that Savneet is considering increasing her
recent random sample from 20 car rentals to 40...
asked 10 months ago -
Trucks arrive at an unloading terminal at an average rate of 120
per hour.
Trucks arrive...
asked 10 months ago -
Why are methanol and ethanol completely soluble in water while
octanol is not very little soluble....
asked 10 months ago -
A facilities manager at a university reads in a research report
that the mean amount of...
asked 10 months ago -
When the CuSO4 is rehydrated by adding water to the anhydrous
compound, is this an endothermic...
asked 10 months ago -
A ray of sunlight is passing from diamond into crown glass; the
angle of incidence is...
asked 10 months ago -
A block of mass 0.249 kg is placed on top of a light, vertical
spring of...
asked 10 months ago -
how do the kidneys compensate in the presences of acidosis
a) trigger hyperventilate
b) reserve acid...
asked 10 months ago -
Question 501 pts
The rental rate of capital to the firm increases. Which of the
following...
asked 10 months ago