HW_01_REV - Economics 11, Winter 2010; HW Assignment #01...

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Economics 11, Winter 2010; HW Assignment #01 Due Thursday Jan 14, 3PM with your TA In all problems, pretend all goods, etc. are divisible. 1. I have budgeted $200 to spend on newspapers this year . (a) The daily edition of the LA Times costs $0.50; the daily edition of the NY Times costs $1.25. Sketch my budget set. (b) The NY Times offers a special package deal: $1.00/day if I buy at least 20 days. On the same diagram, sketch my new budget set. (c) In response, the LA Times also offers a special package deal: $0.25/day for the LA Times if I also buy at least 20 days of the NT Times (at the NY times special discount). On the same diagram, sketch my new budget set. 2. Frodo has $3,000 to spend on party hats and party favors for Bilbo’s 111th birthday party. At the supermarket in Bag End, party hats cost $3 and party favors cost $1; at the supermarket in Bree, party hats cost $2 and party favors cost $4. Obviously Frodo ought to buy party hats in Bree and party favors in Bag End – but he only has time to
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This note was uploaded on 04/01/2010 for the course ECON 180052110 taught by Professor Mcdevitt during the Winter '09 term at UCLA.

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HW_01_REV - Economics 11, Winter 2010; HW Assignment #01...

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