平狄克和鲁宾费尔德微观经济学microeconomics-rubinfeld-pindyck--te

BooksWinePrice-ConsumptionCurve8910111234567CHAPTER4INDIVIDUALANDMARKETDEMANDEXERCISES1.Anindividualsetsasideacertainamountofhisincomepermonthtospendonhistwohobbies,collectingwineandcollectingbooks.Giventheinformationbelow,illustrateboththeprice-consumptioncurveassociatedwithchangesinthepriceofwineandthedemandcurveforwine.PriceWinePriceBookQuantityWineQuantityBookBudget$10$1078$150$12$1059$150$15$1049$150$20$10211$150Theprice-consumptioncurveconnectseachofthefouroptimalbundlesgiveninthetable,whilethedemandcurveplotstheoptimalquantityofwineagainstthepriceofwineineachofthefourcases.Seethediagramsbelow.2.Anindividualconsumestwogoods,clothingandfood.Giventheinformationbelow,illustrateboththeincome-consumptioncurveandtheEngelcurveforclothingandfood.PriceClothingPriceFoodQuantityClothingQuantityFoodIncome$10$2620$100$10$2835$150$10$21145$200$10$21550$250PriceWineDemandCurve51015201234567Theincome-consumptioncurve(seediagramatright)connectseachofthefouroptimalbundlesgiveninthetableabove.Astheindividual’sincomeincreases,thebudgetlineshiftsoutandtheoptimalbundleschange.TheEngelcurveforeachgoodillustratestherelationshipbetweenthequantityconsumedandincome(ontheverticalaxis).BothEngelcurves(seediagramsbelow)areupwardsloping,sobothgoodsarenormal.3.Janealwaysgetstwiceasmuchutilityfromanextraballetticketasshedoesfromanextrabasketballticket,regardlessofhowmanyticketsofeithertypeshehas.DrawJane’sincome-consumptioncurveandherEngelcurveforballettickets.BalletticketsandbasketballticketsareperfectsubstitutesforJane.Therefore,shewillconsumeeitherallballetticketsorallbasketballtickets,dependingonthetwoprices.Aslongasballetticketsarelessthantwicethepriceofbasketballtickets,shewillchooseallballet.Ifballetticketsaremorethantwicethepriceofbasketballtickets,shewillchooseallbasketball.Thiscanbedeterminedbycomparingthemarginalutilityperdollarforeachtypeofticket,wherehermarginalutilityfromanotherballetticketis2timeshermarginalutilityfromanotherbasketballticketregardlessofthenumberofticketsshehas.Herincome-consumptioncurvewillthenliealongtheaxisofthegoodthatshechooses.Asincomeincreasesandthebudgetlineshiftsout,shewillbuymoreofthechosengoodandnoneoftheothergood.HerEngelcurveforthegoodchosenisanupward-slopingstraightline,withthenumberofticketsequaltoherincomedividedbythepriceoftheticket.Forthegoodnotchosen,herEngelcurveliesonthevertical(income)axisbecauseshewillneverpurchaseanyofthoseticketsregardlessofhowlargeherincomebecomes.4.a.Orangejuiceandapplejuiceareknowntobeperfectsubstitutes.Drawtheappropriateprice-consumptioncurve(foravariablepriceoforangejuice)andincome-consumptioncurve.ClothingFoodIncome-ConsumptionCurve48121620253035404550IncomeFoodEngelCurveforFood10015020025020253035404550IncomeClothingEngelCurveforClothing1001502002506810121416WeknowthatindifferencecurvesforperfectsubstitutesarestraightlineslikethelineEFintheprice-consumptioncurvediagrambelow.Inthiscase,theconsumeralwayspurchasesthecheaperofthetwogoods(assumingaone-for-onetradeoff).Ifthepriceoforangejuiceislessthanthepriceofapplejuice,theconsumerwillpurchaseonlyorangejuiceandtheprice-consumptioncurvewillliealongtheorangejuiceaxisofthegraph(frompointFtotheright).AppleJuiceOrangeJuiceUEFPA=POPAPOPAPOIfapplejuiceischeaper,theconsumerwillpurchaseonlyapplejuiceandtheprice-consumptioncurvewillbeontheapplejuiceaxis(abovepointE).Ifthetwogoodshavethesameprice,theconsumerwillbeindifferentbetweenthetwo;theprice-consumptioncurvewillcoincidewiththeindifferencecurve(betweenEandF).Assumingthatthepriceoforangejuiceislessthanthepriceofapplejuice,theconsumerwillmaximizeherutilitybyconsumingonlyorangejuice.Asincomevaries,onlytheamountoforangejuicevaries.Thus,theincome-consumptioncurvewillbetheorangejuiceaxisinthefigurebelow.Ifapplejuicewerecheaper,theincome-consumptioncurvewouldlieontheapplejuiceaxis.AppleJuiceOrangeJuiceU2U1U3BudgetConstraintIncomeConsumptionCurve4.b.Leftshoesandrightshoesareperfectcomplements.Drawtheappropriateprice-consumptionandincome-consumptioncurves.Forperfectcomplements,suchasrightshoesandleftshoes,theindifferencecurvesareL-shaped.Thepointofutilitymaximizationoccurswhenthebudgetconstraints,L1andL2touchthekinkofU1andU2.Seethefollowingfigure.LeftShoesU2U1RightShoesL1L2PriceConsumptionCurveInthecaseofperfectcomplements,theincomeconsumptioncurveisalsoalinethroughthecornersoftheL-shapedindifferencecurves.Seethefigurebelow.LeftShoesU2U1RightShoesL1L2IncomeConsumptionCurve5.Eachweek,Bill,Mary,andJaneselectthequantityoftwogoods,X1andX2,thattheywillconsumeinordertomaximizetheirrespectiveutilities.Theyeachspendtheirentireweeklyincomeonthesetwogoods.a.SupposeyouaregiventhefollowinginformationaboutthechoicesthatBillmakesoverathree-weekperiod:x1x2P1P2IWeek110202140Week27193140Week38313155DidBill’sutilityincreaseordecreasebetweenweek1andweek2?Betweenweek1andweek3?Explainusingagraphtosupportyouranswer.Bill’sutilityfellbetweenweeks1and2becauseheconsumedlessofbothgoodsinweek2.Betweenweeks1and2thepriceofgood1roseandhisincomeremainedconstant.Thebudgetlinepivotedinwardandhemove