10. During a war, food and clothing are rationed. In addition to a money price, a certain number of ration points must be paid to obtain a good.Each consumer has an allocation of ration points which may be used to purchase either good, as well as a fixed money income. Suppose the money income of a consumer rises and this person buys more food and less clothing. Does it follow that food is a normal good? | Clothing as inferior good? momqiups Isnoit 1 1. Day care is a serious problem for many families. Legislators are aware of the increasing demand by working parents of young children to do something about day care. Assume you are evaluating two subsidy programs. Program 1: A family receives a per unit subsidy for each day a child attends an authorized day care facility. Program 2: Each family with a child registered in an authorized day care facility receives a lump sum subsidy. An association which represents day care providers actively lobbies for program I and is very much against program 2. Legislators tell the association that both programs will cost taxpayers the same amount of money. Using your knowledge of consumer theory, canon you provide a possible explanation for the legislators for why day care providers may be so adamant in their support of program 1? (Assume preferences are normal, using days of day care on the horizontal axis and all other goods on the vertical.) 12. .Construct the market demand and market supply for the following two demanders and suppliers. Qd1 = 50 - P Qs1 = 2P Qd2 = 100 - 4P Qs2 = 4P - 10 a. Determine the equilibrium price and quantity for this market. b. At what price, P = $40 or P = $10 is demand MORE elastic? 13. The following three groups make up the demand for zucchini. DI = 20 -2P where D1,D2, D3 represent quantity demanded for the D2 = 10 - 4P three groups D3 =50 - 10P a. Derive the market demand curve for this good and graphically illustrate it. b. If supply for this good is Qs = 10 + P (with Qs: quantity supplied, P:price per unit), what is the equilibrium price and quantity? C. What type of price elasticity does this supply curve have? 14. If Qd = 20 - 1/3P, at what price will elasticity of demand equal -1/4