Question
Askar's income is 60'000 tenge. He consumes two goods: apples and computer games (for simplicity, assume that it is possible to buy any fraction of
Askar's income is 60'000 tenge. He consumes two goods: apples and computer games (for simplicity, assume that it is possible to buy any fraction of a game). Assume that the price of apples is 500 tenge/kilogram and the price of computer games is 1000 tenge.
1. Plot Askar's budget set.
2. The government decided to battle video game addiction and introduced a tax of 1'500 tenge per game for anyone buying more than 10 games (if you buy 12 games, only the last two games are taxed). Plot Askar's budget set.
3. In addition to the tax described in question 2, the government decided to provide 20 kilograms of apples to every person for free. Plot Askar's budget set.
4. Consider the situation describe in question 2 again. The computer store is trying to stimulate demand for loyal customers and offers a discount of 500 tenge for everyone buying more than 14 games (if you buy 17 games, you get a discount on only the last three games). Plot Askar's budget set.
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