. True, False, or Uncertain: There is no reason to pay someone $20 to maintain your bicycle, when you can do it yourself for free. . At the price of $2 per bottle, Michael buys 10 bottles of coke per month. His demand curve is linear, where a $1 change in price leads to a 2 bottle change in consumption. a) Show on an appropriate diagram Michael's Total Benet from his coke con- sumption. Calculate the dollar amount of Total Benet. b) Show on an appropriate diagram Michael's Consumer Surplus from his coke consumption. Calculate the dollar amount of Consumer Surplus. c) This month when Michael went to the shop they only had 8 bottles of coke for sale. Calculate his Consumer Surplus for this month's coke consumption. . The bakery sells meat pies and donuts. Last year, the bakery offered free tomato sauce with any purchase. They new charge 30c per tomato sauce packet. What do you expect would happen to the demand for donuts? . True, False, or Uncertain: \"There is no reason to buy a bike rather than a car since the utility gained from having a car is much larger than the utility gained from only having a bike.\" . Describe an instance of trade from your life in which no additional resources are consumed, but nevertheless all individuals become better off. By contrast, describe a trade from your life where the result of the trade is addi- tional consumption by all individuals involved (or where there is the same level of consumption, but less cost to produce those goods). . (Time-permitting) You have a food budget for the week of $50, which you can spend on rice or vegetables. Rice costs $1 per meal, and vegies cost $4 per meal. Your main preference is to have 20 meals per week. Fewer meals is terrible, and more is useless. If you have 20 meals, you prefer vegetable meals over rice meals. a) Draw the budget constraint for this scenario. b) Find the optimal consumption bundle of rice and vegetable meals. c) Suppose your food budget increases to $65 per week. Draw the new budget constraint, and nd the new optimal consumption bundle. d) Are rice and vegetables normal goods, or inferior goods