Explain the following questions
3. Shirley maximizes utility by setting MRS=1+r as she is planning over a two-year period. She earns $50,000 this year and will earn $70,000 next year. The marginal rate of substitution (MRS) of MRS=2C1\\Co. The interest rate is 3%. 3a. Write down the two-period budget constraint in terms of Co and C1 (the two-period budget constraint must only have numbers, Co and C1). 3b. Calculate how much is consumed in the first year (Co). 3c. Calculate savings and explain your answer. Show how to use savings and year 2 earnings to determine his year two consumption (C1).Problem #1: For the project depicted below, Activity 2 Activity 4 T-9 FF T-5 EF= LS IF works LF- Activity 1 Activity 6 Start 1=6 ES= EF T=2 ES EF End LF who LS LF Activity 3 Activity 5 T=0 T-J IS= LF= 152 LF= (a) Construct a Gantt chart. How long do you expect the project to take to complete? (b) Compute the ES, EF. LS, and LF times for the network. (c) Explain how the ES for Activity 3 is obtained.Question 1. [15 marks] in a small town Tuftsville everyone lives along Main Street, which is 10 miles long. There are 1,000 people uniformly spread up and down Main Street, and every day they each buv fruit smoothie from one of the two stores located at either end of the street. Customers ride their motor scooters to and from the store, using $0.50 worth of gas per mile. Customers buy their smoothies from the store offering the lowest price, which is the store's price plus the customer's travel expenses getting to and from the store. Ben owns the store at the west end of Main Street and Will owns the store at the east end of Main Street. The marginal cost of a smoothie is constant and equal to $1 for both Ben and Will. in addition, each ofthem pays Tuftsville $250 per day for the right to sell smoothies. a} [11 marks] Ben sets his price p1 first and then, after observing pl, Will sets his price p2. After the prices are posted consumers get on their scooters and buy. What prices will Ben and Will set? b} [4 marks] How many customers does each store serve and what are their prots? Given the network that follows compute the early start and finish, late start and finish, slack times for each activity a. What is the critical path? b. What is the project duration? c. Draw a Gantt chart for the network using the ES times for each activity d. Draw the resource loading profile for Carpenters given the following requirements: One carpenter is needed for activities A B, C, D and E. Two carpenters are needed for activity F. e. What is the peak numbers of Carpenters needed? f. What is the utilization of Carpenters? g. Level within slack to reduce the peak number of Carpenters to 2. Redraw the Gantt chart and the resource loading profile. h. What is the revised utilization? Network for problem 14. A 1C D Start 1C 2 F B 20 10 2 2 E C IC 4 1C 3
