Harry consumes two goods: books and coffee. Harry earns an income of $40 per month. He can spend his entire income on books and get 5 books, or he can spend his entire income on coffee and get 20 cups.

Question 4 (1.25 points)

The table, below, shows the bundles that Harry can afford with his income. Calculate the answers for a.-d. in the table with quantities that will exhaust Harry's income.

Books	Coffee
1	a.
b.	0
c.	8
2	d.

Question 4 options:

Question 5 (1.25 points)

Harry receives a bonus, and his income increases to $80 per month. What is the new equation of his budget constraint? Reduce the equation to the simplest form.

Question 5 options:

Question 6 (1.25 points)

Harry's income remains constant at $40 ,but the price of books increases from $8 to $10. What is the equation of his new budget constraint?

Question 6 options:

Question 7 (1.25 points)

If the price of coffee is $2 and the price of a book is $8, and the marginal utility of a book is 20, what is the marginal utility of coffee if Harry is maximizing his utility?

Question 7 options:

Question 8 (1.25 points)

Assume that books and coffee are complements to Harry. This means that for Harry to consume one book he must consume one cup of coffee. How many books can he consume with an income of $40 if the price of coffee is $2 and the price of books is $8?

Question 8 options:

Question 9 (1.25 points)

Now assume that Harry needs two cups of coffee per book. How many books can he consume?

Question 9 options:

Question 10 (1.25 points)

If CDs cost $6 and sodas cost $4, Sheila can afford to buy 6 CDs and 8 sodas with her income. If Sheila is maximizing utility at this bundle, what is her income?

Question 10 options:

a)

$54

b)

$72

c)

$68

d)

$100

e)

$40