1 Read the article in Reading Between the Lines on pp. 172173 and then answer the following...

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1 Read the article in Reading Between the Lines on pp. 172–173 and then answer the following questions: a Suppose that the price of a gourmet sandwich halved while Lisa is still a student. i What would happen to the slope of her budget line? ii Would Lisa buy more or fewer gourmet sandwiches? Use an indifference curve drawing to explain your answer. b Lisa gets her first job. Suppose she finds gourmet sandwiches a bit boring and now prefers hamburgers. i How does the shape of her indifference curves between gourmet sandwiches and hamburgers change? ii Use a graph to explain whether she will buy more or less gourmet sandwiches if the price of a gourmet sandwich does not change. iii Will gourmet sandwiches be a luxury good or an inferior good for Lisa now?

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Economics

ISBN: 9781509540235

6th Edition

Authors: Michael Parkin, Melanie Powell, Kent Matthews

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