# Microeconomics

posted by .

This is due Monday. I am not sure I am doing it correctly. Can someone help me out?

Question:
Assume that Jim is a rational customer who consumes only two goods, apples(A) and nuts(N). Assume also, that his marginal rate of substitution (MRS) of nuts for apples is given by the following formula:
MRS=MU(a)/MU(n)=N/A
That is, Jim's MRS is simply equal to the ratio of the number of apples consumed to the number of nuts consumed. Jim's income is \$200,the price of nuts is \$10/lb, and the price of apples is \$5/lb.
Calculate the quantities of apples and nuts Jim will consume.

I appreciate the help!

Im a bit confused, could you check to see if you have the problem copied correctly.

You have MRS=MU(a)/MU(n) = N/A
It would make more sense if the equation was: MRS=MU(a)/MU(n) = A/N

In which case, utility is maximized when MRS = slope of the budget constraint which is 2A/N or simply 2.
He consumes 20 apples and 10 nuts.

never mind my first statement; your original formula was (probably) copied correctly.

But the final answer still holds true: Utility is maximized whe the MRS=slope of the busget constraint, which happens at 20A and 10N

microeconomics is cool

The problem is copied correctly. thanks for your help!

I have 30 short question to be answered plus 30 multiple choice question to be completed can someone help! I will pay you.....

You plan to go skiing next weekend. If you do, you’ll have to miss your usual weekend job that pays \$100. You won’t be able to study for 8 hours and you won’t be able to use your prepaid college meal plan. The cost of your travel and accommodations will be \$350, the cost of renting skis is \$60, and your food will cost \$40. What is the opportunity cost of the weekend ski trip?

• Microeconomics -

Your opportunity cost is the cost of the next best alternative you are forgoing to go skiing. In this case that is work and studying.

The trip costs \$350 + \$60 for skiis + \$40 for food. The trip will cost a total of \$450.

Your opportunity cost is \$450 plus what you lose from not staying home. So your opportunity cost is \$550 + (not given \$ values in question) value that 8 hours of studying has to you + cost of the meals you miss.

Hope this helps

## Similar Questions

1. ### Mirco economics

Why does trade of any type take place? Illustrate your answer by reference to each of the following: 1. Market exchange in which price is determined by Demand and supply. (refer in your answer to producer and consumer surplus) 2. Exchange
2. ### Algebra!

Six pears and three apples cost \$3.90. Two pears and five apples cost \$3.30. How much does one pear cost?
3. ### Finance

Jim Bob is a stock picking genius. Every year, based on his system, he has the ability to invest \$100 (only) in a security that is expected to earn a 20% return over the next year. That security always has a beta of one. Assume that …
4. ### microeconomics

Veena always consumes 3 times as much y as she consumes x. She will consume these goods in no other ratio. The price of x is three times the price of y. Veena has an endowment of 18 units of x & 78 units of y which she can trade at …
5. ### Physics

What is the difference in volume (due only to pressure changes, not temperature or other factors) between 1000 kg of water at the surface (assume 4 degrees C) of the ocean and the same mass at the deepest known depth, 8.00 km?
6. ### Chemistry

Assume that you had 15 nuts (N) and 10 bolts (B). How many N2B molecules could you make by screwing two nuts onto each bolt?
7. ### Statistics

On a very short quiz, there is one multiple choice question with 5 possible choices (a, b, c, d, e) and one true or false question. Assume you are taking the quiz but do not have any idea what the correct answer is to either question. …
8. ### social studies

The Some Interest Credit Company provides loans to customers at 1.5 percent interest per month. Design an application that gets customer account data that includes an account number, customer name, and balance due. For each customer, …
9. ### math

Assume that you have to select some of the applicants for registration in some particular academic programme. Also assume that there happens to be a tie among two students having the least score. One of them has 85 marks out of 100 …
10. ### probabilities

A multiple choice test has 16 questions. Each question has 4 possible answers with only one is correct. Assume that all questions are answered and the probability to answer any question correctly is 0.25. Let X be the number of questions …

More Similar Questions