This preview shows page 1. Sign up to view the full content.
Unformatted text preview: c. Suppose initially p 1 = $8, p 2 = $2, and I = $800. Find the corresponding optimal bundle. 3. John buys 10 new college textbooks during his rst year at school at a cost of $80 each. Used books cost only $45 each. When the bookstore announces that there will be a 12% increase in new texts and a 8% increase in used texts for the next year, Johns father oers him $80 extra. Is John better o or worse o after the price change? Support you answer. 1...
View Full Document
- Winter '10