A forthcoming article analyzes the leisure activities of employed young men (ages 21-30) in the United States.

IA micro 303 assighn... x ? X 3 / 4 + 59.3% 4. (18 points) A forthcoming article analyzes the leisure activities of employed young men (ages 21- 30) in the United States. Lo LL PDF Leisure Time for Employed Men Aged 21-30 (Hours per Week) Activity 2004-2007 2014-2017 Change Total Leisure 61.1 63.4 2.3 Adobe Acrobat Pro DC Recreational Computer 3.3 6.1 2.1 39 2.1 Video Game 1.8 * PDF X14 X#/145xX Word EX Excel ESP 24.3 26.0 1.7 TV/Movies/Netflix 17.4 15.8 -1.6 Socializing 7.8 76 -0.2 Other Leisure 8.3 -0.3 Note: ESP is eating, sleeping (more than 7 hours), and personal care. Total leisure time increased by 2.3 hours/week. The authors calculated that a 1 percent increase in 41 PDF eisure time was associated with about a 2.5 percent increase in recreational computing time for younger men. a) (2 points) Please give a short definition of a luxury good. (One or two sentences should suffice.) LO BUZZ PDF b) (4 points) If preferences for recreational computing (RC) were homothetic, what percentage increase in RC would we see from a 1 percent increase in leisure time? NRC A#X1+ 61.1 61.1 RC c) (8 points) See the figure above with recreational computer leisure (RC) on the X axis and all leisure that is not recreational computer leisure (NRC) on the Y axis. The budget line represents total hours of leisure in 2004-7. Please draw a second budget line for 2014-7. Now draw indifference curves that yield the relevant bundles in the table for RC and NRC (your graph need not be exact). Based on your figure, briefly explain why the authors call "recreational computing" a PDF MASK luxury leisure good for young men. (Two sentences should be enough, along with your figure.)