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Q1. Sanjana loves to read books(B) and likes to watch movies(M) as well. She derives double the satisfaction from reading a book than watching a movie. Her utility function is as follows
U(B, M) = 2B + M
Q1. Sanjana loves to read books(B) and likes to watch movies(M) as well. She derives double the satisfaction from reading a book than watching a movie. Her utility function is as follows U(B, M) = 2B + M Where B and M are the number of books and movies respectively. a. Explain the shape of the indifference curve using diagrams. [3 MARKS, Word limit: 200] b. The income available with her is INR60. And price of movie ticket is INR 10 and that of a book is INR 15. Will she spend her entire budget and why? What will be her consumption, explain why
1. If history repeats itself and we see a decline in the rate of money growth, what might you expect to happen to
a. Real output?
b. The inflation rate?
c. Interest rates?
1. If history repeats itself and we see a decline in the rate of money growth, what might you expect to happen to
a. Real output?
b. The inflation rate?
c. Interest rates?
Q2. Suppose you are on a three-day trip to Rome (from Monday to Wednesday) and during your stay you decide to consume only Waffle and Ravioli (measured on the horizontal and vertical axes respectively). You have a given amount of money (some constant) to spend on each of the three days. Suppose that the price of Waffle rises between Monday and Tuesday. If your optimum points of consumption on Monday and Tuesday are respectively called M and T, such that M to the left of T, what does it say about both the commodities? Illustrate your answer using an appropriate diagram. [3 MARKS, Word limit: 200]
Sanjana loves to read books(B) and likes to watch movies (M) as well. She derives double the satisfaction from reading a book than watching a movie. Her utility function is as follows
U(B, M) = 2B + M
Where B and M are the number of books and movies respectively.
a. Explain the shape of the indifference curve using diagrams. [3 MARKS, Word limit: 200] b. The income available with her is INR60. And price of movie ticket is INR 10 and that of a book is INR 15. Will she spend her entire budget and why? What will be her consumption, explain why?
Make some observations of businesses around your community or watch news
on television. Based on your observations, identify the factors affecting their businesses during the pandemic. How does the COVID- 19 affect their business? Explain your answer using the PEST chart.
Political —
Economic —
Social —
Technology —
Make some observations of businesses around your community or watch news
on television. Based on your observations, identify the factors affecting their businesses
during the pandemic. How does the COVID- 19 affect their business? Explain your answer using the PEST chart.
Political —
Economic —
Social —
Technology —
Sanjana loves to read books(B) and likes to watch movies(M) as well. She derives double the satisfaction from reading a book than watching a movie. Her utility function is as follows
U(B, M) = 2B + M
Where B and M are the number of books and movies respectively.
a. Explain the shape of the indifference curve using diagrams. [ Word limit: 200]
b. The income available with her is INR60. And price of movie ticket is INR 10 and that of a book is INR 15. Will she spend her entire budget and why? What will be her consumption, explain why?
The set of equations for an economic model is as follows:
Y = C + S + T , E = C + I* + G* , C = A + bYD , YD = Y - T , T = T* + tY , B = T – G*
, Y = E
A, I* and G* are the exogenous variables for autonomous consumption expenditure autonomous investment, government expenditure, respectively.
The following economic shock has occurred in this economy, ceteris paribus:
The requirements for housing loans have been tightened.
Represent this economic shock by drawing an appropriate new function. Mark W2 if the appropriate new function is a withdrawal function, or J2 if the appropriate new function is an injection function, or both.
Indicate the following after the occurrence of the above economic shock in J-W curve:
(i) the new equilibrium point as point E2, and
(ii) the level of new equiliribium output as Y2
