Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Question 1: 9 Marks Ashwin likes to spend her spare time in summer in one of two ways: (i) watching cricket (x) at Sydney Cricket

image text in transcribedimage text in transcribedimage text in transcribed
image text in transcribedimage text in transcribedimage text in transcribed
Question 1: 9 Marks Ashwin likes to spend her spare time in summer in one of two ways: (i) watching cricket (x) at Sydney Cricket Ground or (ii) watching movies (y) at Ritz cinema. In choosing how to entertain herself, she considers both constraints---money and time. Part I (3 marks) Ashwin has 48 hours of spare time in a month. A cricket game runs for 8 hours, while each visit to the movies takes up 4 hours. Each month, Ashwin also has $324 to spend on entertainment. A ticket for a cricket game costs $45. A visit to the movie costs $36. (a) (1 mark) Write down Ashwin's budget constraint and time constraint. (b) (2 marks) Perhaps \"Draw Ashwin's budget constraint and time constraint in a clearly labelled diagram. Label all axis intercepts in the two axes (x and y) and the point of intersection of the two budget lines. Shade the set of bundles that Ashwin can afford (those satisfying both his time and money constraints) with vertical lines." Part III (3 marks) To attract cricket fans back after Covid as well as to cover revenue shortfall, the local cricket association has decided to offer a season ticket for $144. Tickets are now NO LONGER sold separately for each game (i.e., the season ticket is the only option if one wants to watch cricket at SCG). With the season ticket Ashwin can watch as many cricket games as he wants. (c) (1 mark) Draw Ashwin's new budget constraint for money, and shade in his new affordable set of bundles with horizontal lines. (d) (2 marks) Is Sam better off or worse off with the introduction of season ticket? What about Ashwin

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Microeconomics

Authors: Austan Goolsbee, Steven Levitt, Chad Syverson

3rd Edition

1319105564, 978-1319105563

More Books

Students also viewed these Economics questions

Question

What features make steel an attractive material for recycling?

Answered: 1 week ago