Tyrone is a utility maximizer. His income is $100, which he can spend on cafeteria...

armlanna1sK

armlanna1sK

Answered

2022-12-05

Tyrone is a utility maximizer. His income is $100, which he can spend on cafeteria meals and on notepads. Each meal costs $5, and each notepad costs $2. At these prices Tyrone chooses to buy 16 cafeteria meals and 10 notepads.
The price of notepads falls to $1; the price of cafeteria meals remains the same. What are the new values for the vertical intercept, horizontal intercept, and slope?
Vertical Intercept:
Horizontal intercept:
Slope:

Answer & Explanation

Bria Mccoy

Bria Mccoy

Expert

2022-12-06Added 11 answers

Vertical axis intercept = (Income / price of notepads)
Horizontal axis intercept = (Income / price of meals)
Price of notepads $1
Price of meals $5
Income is $100
Vertical intercept = (Income / Price of notepads)
V = $100 / $1 = 100
Horizontal intercept = (Income / Price of meals)
H = $100 / $ 5 = 20
Slope = -Price of meals / Price of notepads
S = -5 / 1 = -5

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