1.
Suppose that Bridget and Erin spend their incomes on two goods, food (F) and clothing (C). Bridgetâs preferences are represented by the utility function U(F,C)=10FC, while Erinâs preferences are represented by the utility function U(F,C) = 20 * F2 * C2 . Food price is $10 per unit and Clothing price is $15 per unit. Income is $1000 for both of them.
Find optimal choices of food and clothing for Erin and Bridget. No need to draw a curve.
From optimal choice, imagine Erin and Bridget have to decrease consumption of clothing. Who would be more upset? In other words, who would be giving up more in terms of utility? Remember, income is still constant
- Imagine there is a trust like in example 3.5 in the textbook. Trust would be given to you only for your tuition fee and potential income growth. Requirements are as follows: I. Your income should reach $35,000 to be awarded the trust. II. Your tuition will be free (Price of college becomes P=0) if used. Otherwise, you have to pay a tuition fee P= $ 20,000 To make your income grow you can choose to work overtime and get $35 000 in income. Otherwise you may choose to work less and enjoy more leisure. In this case you receive $30 000 as income. Other items cost $ 1,000 per unit. You will work hard if you want to get awarded the trust. a) Draw a budget line in case of not awarded and awarded. Pay attention to how the budget line changes due to price change in college tuition. b) Find your optimal consumption choice. [need to draw an indifference curve. Use a hypothetical indifference curve with three cases: corner solutions and middle solution.]
this is picture
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Sample Solution
honest appeals to the British Government to save Turkey from total disintegration. Those campaigns of the Khilafat Movement at least succeed to collect huge funds for the support of Turks (Ali, 2001). The plight of the Turks distressed the Indian Muslims deeply. That deeply grieved the Indian Muslims were highly appreciated because they blamed all those sufferings upon the British, who they thought were out to destroy the last bastion of Muslims supremacy. Among those Muslim Leaders who warned the British government against the consequences of its interferences with the future of the Khilafat which was led by Muhammad Ali Johar. He urged the government to take into consideration the feelings and sentiments of the Indian Muslims with the regard to Turkey while formulating the policies of the empire. The Muslims hoped that their strong expression of supporter for Turkey would persuade the British not to be too harsh in their treatment of defeated foe. Turkey signed the armistice on 3 November 1918 immediately, after that the British forces marched into Mosul. Constantinople was officially occupied by the Allies mainly by the British. Finally on 15 May the Greek armies, at the instance of England entered Smyrna. The British Government paid no head to the numerous appeals made by the Muslims from all over the India to spare Turkey. As Muslims hopes were crashed they were driven into a confrontation with the British rulers. (Ali, 2001) On October 1919, the All India Khilafat Committee observed th>
honest appeals to the British Government to save Turkey from total disintegration. Those campaigns of the Khilafat Movement at least succeed to collect huge funds for the support of Turks (Ali, 2001). The plight of the Turks distressed the Indian Muslims deeply. That deeply grieved the Indian Muslims were highly appreciated because they blamed all those sufferings upon the British, who they thought were out to destroy the last bastion of Muslims supremacy. Among those Muslim Leaders who warned the British government against the consequences of its interferences with the future of the Khilafat which was led by Muhammad Ali Johar. He urged the government to take into consideration the feelings and sentiments of the Indian Muslims with the regard to Turkey while formulating the policies of the empire. The Muslims hoped that their strong expression of supporter for Turkey would persuade the British not to be too harsh in their treatment of defeated foe. Turkey signed the armistice on 3 November 1918 immediately, after that the British forces marched into Mosul. Constantinople was officially occupied by the Allies mainly by the British. Finally on 15 May the Greek armies, at the instance of England entered Smyrna. The British Government paid no head to the numerous appeals made by the Muslims from all over the India to spare Turkey. As Muslims hopes were crashed they were driven into a confrontation with the British rulers. (Ali, 2001) On October 1919, the All India Khilafat Committee observed th>
