S. Below is a graph of Kyann's budget constraint when she spends all her annual income (m) on two goods, motorcycles and pedicures. Let good 1 be motorcycles and good 2 be pedicures, Prices are given by P, and p. respectively. Kyann was given a gift card of 2,000 dollars that can only be spent an motorcycles. X: (pedicures) slope = 0 1600 slope -40 BC X. motorcycles Your task in this problem is to figure out (using the numbers and shape of the budget constraint above), the following information: (Though you all may approach this slightly differently, you must clearly show work and logic for each piece to receive credit. Do not just simply list an answer). Hint: even if you're not sure where to start that's okay, write down the formula for finding intercepts and slopes and then look at the information you are given in the graph a. What is Kyann's annual income (m)? b. What is the price of motorcycles (P.)? c. What is the price of pedicures (P)? d. Either re-graph this picture by hand in your notes or take a screenshot and copy it into your notes, so we can add to it. If Kyann is simply given $2,000 in cash instead of a gift card, graph her new budget constraint (with the $2,000 in cash) in this same graph. Compare your budget constraint in part (d) to the one given with the $2.000 gift card). Under which budget constraint is the budget set larger? That is under which budget constraint are there more consumption opportunities for Kyann? Please shade in the area of the budget set that consumers can achieve under the $2,000 cash policy that are not attainable under the $2000 motorcycle gift card policy. S. Below is a graph of Kyann's budget constraint when she spends all her annual income (m) on two goods, motorcycles and pedicures. Let good 1 be motorcycles and good 2 be pedicures, Prices are given by P, and p. respectively. Kyann was given a gift card of 2,000 dollars that can only be spent an motorcycles. X: (pedicures) slope = 0 1600 slope -40 BC X. motorcycles Your task in this problem is to figure out (using the numbers and shape of the budget constraint above), the following information: (Though you all may approach this slightly differently, you must clearly show work and logic for each piece to receive credit. Do not just simply list an answer). Hint: even if you're not sure where to start that's okay, write down the formula for finding intercepts and slopes and then look at the information you are given in the graph a. What is Kyann's annual income (m)? b. What is the price of motorcycles (P.)? c. What is the price of pedicures (P)? d. Either re-graph this picture by hand in your notes or take a screenshot and copy it into your notes, so we can add to it. If Kyann is simply given $2,000 in cash instead of a gift card, graph her new budget constraint (with the $2,000 in cash) in this same graph. Compare your budget constraint in part (d) to the one given with the $2.000 gift card). Under which budget constraint is the budget set larger? That is under which budget constraint are there more consumption opportunities for Kyann? Please shade in the area of the budget set that consumers can achieve under the $2,000 cash policy that are not attainable under the $2000 motorcycle gift card policy
