ass3 - Irene Ladies Menajang IIC/100613031 MICROECONOMICS...

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Unformatted text preview: Irene Ladies Menajang IIC/100613031 MICROECONOMICS ASSIGNMENT PAGE 161 2. The following table gives a hypothethical total utility schedule for the Cookie Monster (CM): NUMBER OF COOKIES TOTAL UTILITY 1 100 2 200 3 275 4 325 5 350 6 7 360 360 Calculate the CMs marginal utility schedule. Draw a graph of total and marginal utility. If cookies cost the CM 5cents each and CM had a good income, what is the maximum number of cookies he would most likely eat? Number of cookies Total Utility Marginal Utility Price Marginal Utility/Price $5 1 100 100 5 20 2 200 100 5 20 3 275 75 5 15 4 325 50 5 10 5 350 25 5 5 6 360 10 5 2 7 360 5 3.Kamika lives in Chicago but goes to school in Tucson, Arizona. For the last 2 years, she has made four trips to home each year. During 2008, the price of a round-trip ticket from Chicago to Tucson increased from $350 to $600. As a result, Kamika decided not to buy a new outfit that year and decided not to drive to Phoenix with friends for an expensive rock concert a.Explain how Kamikas demand for clothing and concert tickets can be affected by an increase in travel air prices. Airline ticket $350 1 year = 4 trips x $350= $1440 2 years= = $1440 x 2 = $2880 Increased $600, so 1 year = 4 trips x $600 = $2400 2 years= = $2400 x 2 = $4800 $4800 - $2880 = $2920 so Kamika has to pay more for airline ticket....
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ass3 - Irene Ladies Menajang IIC/100613031 MICROECONOMICS...

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