Question
(Perfect complements) Nancy is trying to decide how to allocate her time in studying for her economics course.There are two examinations in this course.Her overall
(Perfect complements) Nancy is trying to decide how to allocate her time in studying for her economics course.There are two examinations in this course.Her overall score for the course will be the minimum of her scores on the two examinations.She has decided to devote a total of 1200 minutes to studying for these two exams, and she wants to get as high an overall score as possible. She knows that on the first examination if she doesn't study at all, she will get a score of zero on it.For every 10 minutes that she spends studying for the first examination, she will increase her score by one point.If she doesn't study at all for the second examination, she will get a zero on it.For every 20 minutes she spends studying for the second examination, she will increase her score by one point.
a) On a graph, draw a "budget line" showing the various combinations of scores on the two exams that she can achieve with a total of 1200 minutes of studying.(Let the x1 = Score on Test 1 be on the horizontal axis, and x2 = Score on Test 2 be on the vertical axis.) On the same graph, draw two or three indifference curves for Nancy.On your graph, find the point on the budget line that gives Nancy the best overall score in the course.
b) what would be an equation for the line passing through the kinks of Nancy's indifference curves.Next, what would be an equation for Nancy's budget line.(Hint for the budget line: if x1 and x2 are the number of points achieved on each test, then the "price" is the amount of time required to earn each point.)
c) Solve the two equations from part b to determine the two test scores that maximize her course grade.
d)Determine the number of minutes she will spend studying for each test.
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