pres08_ass4_sol - W1105.002 Principles of Economics...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
W1105.002 Principles of Economics Assignment 4, due Febr. 21 st 2008 Before submitting your assignment, please make a copy for your own use. Your assignment will not be returned to you before the recitation sessions. Be sure you include: Name: Recitation Section # 1. Sam is at Barnes and Nobel where he wants to use his $20 to purchase notebooks and pens. The price of a notebook is $4, the price of a pen is $2. We measure number of pens along the horizontal axis. Sam’s budget constraint a. is upward sloping. b. has a slope equal to -2. c. intersects the horizontal axis at 2 pens. d. intersects the vertical axis at 5 notebooks. 2. Which of the following statements is (are) true of an indifference curve? (i) Indifference curves are bowed inward. (ii) Combinations of the two goods along lower indifference curves are preferred to combinations along higher indifference curves. . (iii) An indifference curve cannot cross another indifference curve of the same consumer. a. (i) only b. (ii) only c. (i) and (iii) d. (ii) and (iii) e. (i), (ii) and (iii) 3 . Your income increases and you purchase less of a good, then you consider the good to be a. a substitute good. b. a normal good. c. an inferior good. d. a complementary good. 4. Bill’s has worked 40 hours this week. If he works 40 hours this week, his marginal utility from one more hour of free time is 80, his marginal utility of consumption is 5, his hourly wage is $10. This week a. Bill should work 40 hours this week as well.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 04/08/2008 for the course ECON W1105 taught by Professor Musatti during the Fall '07 term at Columbia.

Page1 / 3

pres08_ass4_sol - W1105.002 Principles of Economics...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online