Hideki attends baseball games and goes to movie theaters. Baseball tickets cost $15, and movie tickets cost $10. His entertainment budget is $180.
a. Graph Hideki’s budget constraint for baseball and movie tickets.
b. Suppose the home team is having a good season, and the price of baseball tickets goes up to $20 per game. Graph the new budget constraint.
c. Assuming that baseball and movie tickets are normal goods, what can you say about the quantity of each good that Hideki will consume after the price of baseball tickets goes up? Will the quantity of baseball games he attends increase or decrease, or is the change uncertain? Will the quantity of movies he watches increase or decrease, or is the change uncertain?