Deck 9: Extension: A: Buying and Selling

Question 1

if Abishag owned 10 quinces and 10 kumquats and if the price of kumquats is 2 times the price of quinces, how many kumquats could she afford if she spent all of her money on kumquats?

A)10
B)15
C)20
D)30
E)12

Answer 1

15

Question 2

Suppose that Mario consumes eggplants and tomatoes in the ratio of 1 bushel of eggplants per 1 bushel of tomatoes.His garden yields 30 bushels of eggplants and 10 bushels of tomatoes.He initially faced prices of $25 per bushel for each vegetable, but the price of eggplants rose to $50 per bushel, while the price of tomatoes stayed unchanged.After the price change, he would

A)increase his consumption of eggplants by 5.33 bushels.
B)increase his eggplant consumption by 3.33 bushels.
C)decrease his eggplant consumption by at least 3.33 bushels.
D)decrease his consumption of eggplants by 5.33 bushels.
E)decrease his tomato consumption by at least 1 bushel.

Answer 2

increase his eggplant consumption by 3.33 bushels.

Question 3

Suppose that Mario consumes eggplants and tomatoes in the ratio of 1 bushel of eggplants per 1 bushel of tomatoes.His garden yields 30 bushels of eggplants and 10 bushels of tomatoes.He initially faced prices of $10 per bushel for each vegetable, but the price of eggplants rose to $20 per bushel, while the price of tomatoes stayed unchanged.After the price change, he would

A)decrease his eggplant consumption by at least 3.33 bushels.
B)decrease his consumption of eggplants by 5.33 bushels.
C)increase his consumption of eggplants by 5.33 bushels.
D)increase his eggplant consumption by 3.33 bushels.
E)decrease his tomato consumption by at least 1 bushel.

Answer 3

increase his eggplant consumption by 3.33 bushels.

Question 4

Dr.J has 80 hours per week to divide between work and leisure.His wage rate if $5 per hour.Dr.J receives a lump sum payment of $150 per week.Suppose that the first $100 per week of his labor income is untaxed, but all labor income above $100 is taxed at a rate of 70%.

A)Dr.J's budget line has a kink where his income is $250 and his leisure is 60 hours.
B)Dr.J's budget line has no kinks in the part of it that corresponds to a positive labor supply.
C)The slope of Dr.J's budget line is everywhere -1.50.
D)Dr.J's budget line has a kink in it at the point where he takes 70 units of leisure.
E)Dr.J's budget line has a piece that is a horizontal straight line.

Question 5

Dr.J has 80 hours per week to divide between work and leisure.His wage rate if $5 per hour.Dr.J receives a lump sum payment of $250 per week.Suppose that the first $50 per week of his labor income is untaxed, but all labor income above $50 is taxed at a rate of 10%.

A)The slope of Dr.J's budget line is everywhere -4.50.
B)Dr.J's budget line has a kink where his income is $300 and his leisure is 70 hours.
C)Dr.J's budget line has no kinks in the part of it that corresponds to a positive labor supply.
D)Dr.J's budget line has a kink in it at the point where he takes 80 units of leisure.
E)Dr.J's budget line has a piece that is a horizontal straight line.

Question 6

Dudley, has a utility function U(C, R)=C - (12 - R)², where R is leisure and C is consumption per day.He has 16 hours per day to divide between work and leisure.If Dudley has a nonlabor income of $15 per day and is paid a wage of $8 per hour, how many hours of leisure will he choose per day?

A)5
B)6
C)7
D)9
E)8

Question 7

Dr.J has 80 hours per week to divide between work and leisure.His wage rate if $5 per hour.Dr.J receives a lump sum payment of $100 per week.Suppose that the first $50 per week of his labor income is untaxed, but all labor income above $50 is taxed at a rate of 70%.

A)Dr.J's budget line has a kink in it at the point where he takes 80 units of leisure.
B)Dr.J's budget line has a kink where his income is $150 and his leisure is 70 hours.
C)The slope of Dr.J's budget line is everywhere -1.50.
D)Dr.J's budget line has no kinks in the part of it that corresponds to a positive labor supply.
E)Dr.J's budget line has a piece that is a horizontal straight line.

Question 8

Suppose that Mario consumes eggplants and tomatoes in the ratio of 1 bushel of eggplants per 1 bushel of tomatoes.His garden yields 30 bushels of eggplants and 10 bushels of tomatoes.He initially faced prices of $10 per bushel for each vegetable, but the price of eggplants rose to $20 per bushel, while the price of tomatoes stayed unchanged.After the price change, he would

A)increase his eggplant consumption by 3.33 bushels.
B)decrease his eggplant consumption by at least 3.33 bushels.
C)increase his consumption of eggplants by 5.33 bushels.
D)decrease his consumption of eggplants by 5.33 bushels.
E)decrease his tomato consumption by at least 1 bushel.

Question 9

Dudley, has a utility function U(C, R)= C - (12 - R)², where R is leisure and C is consumption per day.He has 16 hours per day to divide between work and leisure.If Dudley has a nonlabor income of $10 per day and is paid a wage of $4 per hour, how many hours of leisure will he choose per day?

A)7
B)8
C)11
D)9
E)10

Question 10

if Abishag owned 8 quinces and 10 kumquats and if the price of kumquats is 2 times the price of quinces, how many kumquats could she afford if she spent all of her money on kumquats?

A)18
B)14
C)10
D)28
E)11

Question 11

if Abishag owned 20 quinces and 20 kumquats and if the price of kumquats is 4 times the price of quinces, how many kumquats could she afford if she spent all of her money on kumquats?

A)50
B)25
C)40
D)20
E)22

Question 12

if Abishag owned 12 quinces and 20 kumquats and if the price of kumquats is 3 times the price of quinces, how many kumquats could she afford if she spent all of her money on kumquats?

A)48
B)32
C)20
D)24
E)21

Question 13

Suppose that Mario consumes eggplants and tomatoes in the ratio of 1 bushel of eggplants per 1 bushel of tomatoes.His garden yields 30 bushels of eggplants and 10 bushels of tomatoes.He initially faced prices of $25 per bushel for each vegetable, but the price of eggplants rose to $100 per bushel, while the price of tomatoes stayed unchanged.After the price change, he would

A)increase his eggplant consumption by 6 bushels.
B)increase his consumption of eggplants by 8 bushels.
C)decrease his consumption of eggplants by 8 bushels.
D)decrease his eggplant consumption by at least 6 bushels.
E)decrease his tomato consumption by at least 1 bushel.

Question 14

Dudley, has a utility function U(C, R)= C - (12 - R)², where R is leisure and C is consumption per day.He has 16 hours per day to divide between work and leisure.If Dudley has a nonlabor income of $20 per day and is paid a wage of $8 per hour, how many hours of leisure will he choose per day?

A)7
B)6
C)9
D)5
E)8

Question 15

if Abishag owned 6 quinces and 5 kumquats and if the price of kumquats is 3 times the price of quinces, how many kumquats could she afford if she spent all of her money on kumquats?

A)7
B)14
C)11
D)5
E)4

Question 16

Dr.J has 80 hours per week to divide between work and leisure.His wage rate if $5 per hour.Dr.J receives a lump sum payment of $150 per week.Suppose that the first $100 per week of his labor income is untaxed, but all labor income above $100 is taxed at a rate of 70%.

A)Dr.J's budget line has no kinks in the part of it that corresponds to a positive labor supply.
B)The slope of Dr.J's budget line is everywhere -1.50.
C)Dr.J's budget line has a kink in it at the point where he takes 70 units of leisure.
D)Dr.J's budget line has a kink where his income is $250 and his leisure is 60 hours.
E)Dr.J's budget line has a piece that is a horizontal straight line.

Question 17

Dudley, has a utility function U(C, R)= C - (12 - R)², where R is leisure and C is consumption per day.He has 16 hours per day to divide between work and leisure.If Dudley has a nonlabor income of $35 per day and is paid a wage of $0 per hour, how many hours of leisure will he choose per day?

A)11
B)9
C)10
D)13
E)12

Question 18

Suppose that Mario consumes eggplants and tomatoes in the ratio of 1 bushel of eggplants per 1 bushel of tomatoes.His garden yields 30 bushels of eggplants and 10 bushels of tomatoes.He initially faced prices of $10 per bushel for each vegetable, but the price of eggplants rose to $40 per bushel, while the price of tomatoes stayed unchanged.After the price change, he would

A)increase his eggplant consumption by 6 bushels.
B)increase his consumption of eggplants by 8 bushels.
C)decrease his consumption of eggplants by 8 bushels.
D)decrease his eggplant consumption by at least 6 bushels.
E)decrease his tomato consumption by at least 1 bushel.

Question 19

Dr.J has 80 hours per week to divide between work and leisure.His wage rate if $5 per hour.Dr.J receives a lump sum payment of $250 per week.Suppose that the first $150 per week of his labor income is untaxed, but all labor income above $150 is taxed at a rate of 70%.

A)Dr.J's budget line has a kink where his income is $400 and his leisure is 50 hours.
B)The slope of Dr.J's budget line is everywhere -1.50.
C)Dr.J's budget line has a kink in it at the point where he takes 60 units of leisure.
D)Dr.J's budget line has no kinks in the part of it that corresponds to a positive labor supply.
E)Dr.J's budget line has a piece that is a horizontal straight line.

Question 20

Dudley, has a utility function U(C, R)= C - (12 - R)², where R is leisure and C is consumption per day.He has 16 hours per day to divide between work and leisure.If Dudley has a nonlabor income of $30 per day and is paid a wage of $4 per hour, how many hours of leisure will he choose per day?

A)9
B)7
C)8
D)11
E)10

Question 21

Mr.Cog has 18 hours per day to divide between labor and leisure.If he has a nonlabor income of 34 dollars per day and a wage rate of 17 dollars per hour, he will choose a combination of labor and leisure that allows him to spend

A)160 dollars per day on consumption.
B)340 dollars per day on consumption.
C)187 dollars per day on consumption.
D)170 dollars per day on consumption.
E)255 dollars per day on consumption.

Question 22

Mr.Cog has 18 hours per day to divide between labor and leisure.If he has a nonlabor income of 44 dollars per day and a wage rate of 14 dollars per hour, he will choose a combination of labor and leisure that allows him to spend

A)296 dollars per day on consumption.
B)138 dollars per day on consumption.
C)170 dollars per day on consumption.
D)148 dollars per day on consumption.
E)222 dollars per day on consumption.

Question 23

Mr.Cog has 18 hours a day to divide between labor and leisure.If he has 16 dollars of nonlabor income per day and gets a wage rate of 7 dollars per hour when he works, his budget equation, expressing combinations of consumption and leisure that he can afford to have, can be written as

A)7R + C = 142.
B)C = 142 + 7R.
C)7R + C = 16.
D)R + C/7 = 184.
E)C = 190 + 7R.

Question 24

Mr.Cog has 18 hours a day to divide between labor and leisure.If he has 17 dollars of nonlabor income per day and gets a wage rate of 13 dollars per hour when he works, his budget equation, expressing combinations of consumption and leisure that he can afford to have, can be written as

A)R + C/13 = 329.
B)13R +C = 17.
C)C = 251 + 13R.
D)13R + C = 251.
E)C = 302 + 13R.

Question 25

Mr.Cog has 18 hours per day to divide between labor and leisure.If he has a nonlabor income of 48 dollars per day and a wage rate of 15 dollars per hour, he will choose a combination of labor and leisure that allows him to spend

A)318 dollars per day on consumption.
B)149 dollars per day on consumption.
C)159 dollars per day on consumption.
D)183 dollars per day on consumption.
E)238.50 dollars per day on consumption.

Question 26

Mr.Cog has 18 hours per day to divide between labor and leisure.If he has a nonlabor income of 38 dollars per day and a wage rate of 9 dollars per hour, he will choose a combination of labor and leisure that allows him to spend

A)90 dollars per day on consumption.
B)200 dollars per day on consumption.
C)100 dollars per day on consumption.
D)119 dollars per day on consumption.
E)150 dollars per day on consumption.

Question 27

Mr.Cog has 18 hours a day to divide between labor and leisure.If he has 8 dollars of nonlabor income per day and gets a wage rate of 5 dollars per hour when he works, his budget equation, expressing combinations of consumption and leisure that he can afford to have, can be written as

A)5R + C = 98.
B)R + C/5 = 128.
C)C = 98 + 5R.
D)5R + C = 8.
E)C = 122 + 5R.

Question 28

Mr.Cog has 18 hours a day to divide between labor and leisure.If he has 13 dollars of nonlabor income per day and gets a wage rate of 17 dollars per hour when he works, his budget equation, expressing combinations of consumption and leisure that he can afford to have, can be written as

A)17R + C = 13.
B)17R + C = 319.
C)R + C/17 = 421.
D)C = 319 + 17R.
E)C = 358 + 17R.

Question 29

Mr.Cog has 18 hours a day to divide between labor and leisure.If he has 9 dollars of nonlabor income per day and gets a wage rate of 15 dollars per hour when he works, his budget equation, expressing combinations of consumption and leisure that he can afford to have, can be written as

A)C = 279 + 15R.
B)15R + C = 9.
C)15R + C = 279.
D)R + C/15 = 369.
E)C = 306 + 15R.

Question 30

Mr.Cog has 18 hours per day to divide between labor and leisure.If he has a nonlabor income of 40 dollars per day and a wage rate of 6 dollars per hour, he will choose a combination of labor and leisure that allows him to spend

A)148 dollars per day on consumption.
B)74 dollars per day on consumption.
C)94 dollars per day on consumption.
D)64 dollars per day on consumption.
E)111 dollars per day on consumption.