Homework #1John Q. Public spends all of his income on CDs an.
Homework #1John Q. Public spends all of his income on CDs and hamburgers. Draw his budget constraint for these products when the following are true:1)Graph A: his income is $80, the cost of a CD is $2 and a cost of a burger is $2.2)Graph B: his income is $120, the cost of a CD is $2 and the cost of a burger is $2.3)Graph C: his income is $80, the cost of a CD is $5 and the cost of a burger is $2.4)Add an indifference curve into graph A. How many CDs and burgers will he buy to be at equilibrium?5)Add an indifference curve into graph B. How many CDs and burgers will he buy to be at equilibrium?6)Add an indifference curve into graph C. How many CDs and burgers will he buy to be at equilibrium?7)Does the equilibrium level of CDs and burgers change due to the changes in income and costs?
Homework #1John Q. Public spends all of his income on CDs an
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