Suppose Minister Watson changes his policy so that the scale factor is now set at 100. Given this information and holding everything else constant, what was the rate of inflation between 2000 and 2002? 50% 33.33% 25% 100% Between 2000 and 2002, the real price of milk and the real price of honey . increased; increased increased; decreased decreased; increased decreased; decreased Alice consumes only two goods, and Her marginal rate of substitution between good X Y. X (measured on the horizontal axis) and good (measured on the vertical axis) is given by the Y following equation: Marginal rate of substitution between good and good = X Y: Y/X. The of good is $6 per unit, while the price of good is $15 per unit. She has figured out X Y that her optimal consumption of is 10 units. She is now considering buying 4 units of Is X Y. this optimal for Alice? Yes, buying 10 units of and 4 units of is optimal for her. X Y No, she should buy more than 4 units of Y. No, she should buy less than 4 units of Y. There is insufficient information to answer this question. Worf enjoys playing paintball at the Madison Paintball Range (MPR) the only paintball range – in Madison. Suppose it costs $50 for the entry fee to MPR and this fee includes the equipment rental per visit. Furthermore, suppose a packet of paintballs costs $5. Each time Worf visits MPR he always buys 5 packets of paintballs. He allocates $300 of his monthly income to playing paintball and he always maximizes his utility from playing paintball given his income constraint and the costs associated with playing paintball. If MPR reduces its entry fee from $50 to $25, which of the following statements is true? Worf’s total monthly expenditure on paintballing will increase.
Suppose Minister Watson changes his policy so that the scale factor is now set at 100. Given this information and holding everything else constant, what was the rate of inflation between 2000 and 2002? 50% 33.33% 25% 100% Between 2000 and 2002, the real price of milk and the real price of honey . increased; increased increased; decreased decreased; increased decreased; decreased Alice consumes only two goods, X and Y. Her marginal rate of substitution between good X (measured on the horizontal axis) and good Y (measured on the vertical axis) is given by the following equation: Marginal rate of substitution between good X and good Y: = Y/X. The of good X is $6 per unit, while the price of good Y is $15 per unit. She has figured out that her optimal consumption of X is 10 units. She is now considering buying 4 units of Y. Is this optimal for Alice? Yes, buying 10 units of X and 4 units of Y is optimal for her. No, she should buy more than 4 units of Y. No, she should buy less than 4 units of Y. There is insufficient information to answer this question. Worf enjoys playing paintball at the Madison Paintball Range (MPR) – the only paintball range in Madison. Suppose it costs $50 for the entry fee to MPR and this fee includes the equipment rental per visit. Furthermore, suppose a packet of paintballs costs $5. Each time Worf visits MPR he always buys 5 packets of paintballs. He allocates $300 of his monthly income to playing paintball and he always maximizes his utility from playing paintball given his income constraint and the costs associated with playing paintball. If MPR reduces its entry fee from $50 to $25, which of the following statements is true? Worf’s total monthly expenditure on paintballing will increase.