Andy assumed the character of jude in order to confront the

Paul consumes only books and DVDs. At his current consumption bundle, his marginal utility from DVDs is 21 and from books is 4

Nat2105 [25]

Answer:

Paul is NOT maximizing his utility.

Explanation:

Given:

MU $_{D}$ = Marginal utility from DVDs = 21

MU $_{B}$ = Marginal utility from books = 4

P $_{D}$ = Price of DVDS = $11

P $_{B}$ = Price of books = $1

Under the utility maximization theory for two or more goods, utility is said to be maximized by a consumer when the ratios of the marginal utility to price per unit of each good are equal to each other. For this question, this implies that when we have:

MU $_{D}$ / P $_{D}$ = MU $_{B}$ / P $_{B}$ ………………………….. (1)

Therefore, we have:

MU $_{D}$ / P $_{D}$ = 21 / 11 = 1.91

MU $_{B}$ / P $_{B}$ = 4 / 1 = 4

Since 1.91 = MU $_{D}$ / P $_{D}$ < MU $_{B}$ / P $_{B}$ = 4, this implies that these conditions are NOT consistent with equation (1). Therefore, Paul is NOT maximizing his utility.

In order to maximize his utility, Paul should consume more DVDs and consume less books until these conditions are consistent with equation (1).

7 0

3 years ago

Which of the following is not counted as a part of GDP?

Misha Larkins [42]

Answer:

C, The unsold additions to inventory at an appliances store.

Explanation:

GDP = Gross DOMESTIC Product

Since the unsold additions are not sold, there's no money coming from it, thus it is not counted in GDP.

Bonus: If you order clothes from Thailand, that is called GNP. It counts as Thailand's GDP because the money is going into the country, and it counts as America's GNP as you are buying goods from another country.

3 0

3 years ago

Suppose that in 2017, a typical U.S. student attending a state-supported college bought 10 textbooks at a price of $110 per b

Tatiana [17]

Answer:

2017 Price Index is 100
2018 Price Index is 111

Explanation:

The Price Index for any given Base year is always 100. 2017 is staed to be the base year so it's price index is 100.

2018

The Student Price Index can be calculated using the formula;

SPI = $\frac{cost of basket of goods in the year of interest}{Cost of the basket of goods in the base year} * 100$

= $\frac{(10 * 120) + (30* 390)}{(10 * 110) + (30 * 350)}$ * 100

= $\frac{12,900}{11,600} * 100$

= 111.21

= 111

3 0

3 years ago

DON Corp. is contemplating the purchase of a machine that will produce net after-tax cash savings of $20,000 per year for five y

Allushta [10]

Answer:

$74,932.66

Explanation:

Present value is the sum of discounted cash flows.

Present value can be calculated using a financial calculator

Cash flow from year 1 to 4 = $20,000

Cash flow in year 5 = $25,000

I = 12%

Present value = $74,932.66

To find the PV using a financial calacutor:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. After inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.

3. Press compute

I hope my answer helps you

3 0

3 years ago

A Condominium owner files a declaration with the county clerk which divides his individual ownership and ownership in common ele

Degger [83]

Answer:

subdivision

Explanation:

A real property subdivision takes place when a real property (parcel of land, house, etc.) is divided into smaller areas. The whole idea behind a subdivision is that it should be easier to sell the property in smaller parts.

When a subdivision is carried out on a condominium, the physical space is not divided, rather the property time is divided into time share units. In this case, a person can purchase the right to use that condominium during 3 weeks each year.

4 0

3 years ago