Question

A college student has two options for meals: eating at the dining hall for $6 per meal, or eating a cup o' soup for $1.50 per meal. her weekly food budget is $60.

a. draw the budget constraint showing thetrade-off between dining hall meals and cups o' soup. assuming that she spends equal amounts on both goods, draw an indifference curve showing the optimum choice. label the optimum as point

a.

Answer 1

The answer is 40 because you have to divide 60 and then 1.50 to get your answer

Answer 2

Answer:

Since we are not given the amount of utility that each type of food provides, the indifference curve shall equal the budget constraint curve.

If we assume that the optimum choice is located where the student spends equal amounts in dining hall meals and cups o' soups, it will be 5 dining hall meals and 20 cups o' soups.