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Course: Microeconomics - Rational Consumer Choice From Robert Frank's microeconomics textbook. Paula, a former actress, spends all her income on theater and movies, but she
Course: Microeconomics - Rational Consumer Choice From Robert Frank's microeconomics textbook. Paula, a former actress, spends all her income on theater and movies, but she likes theater 3 times as much as movies. a) Plot the map of Paula's indifference curves. b) Paula earns $120 a week. If the theater costs $12 and the movies $4, show the budget line and the highest indifference curve she could reach; how many plays will she see? c) If the theater costs $12 and the movie theater now costs $5, how many plays will she see?
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