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Rabil is a diligent student who loves getting As, but he also loves watching movies. Rabil is awake for 100
hours each week, and studying and watching movies are his only two activities. He must study for 20 hours
per week for each A he earns. Each movie is 2 hours long.
a) Draw Rabil?s budget constraint that show the trade-off between the numbers of As he can receive and the number of movies he can watch. Assuming that he is happiest when he earns three As, draw an indifference curve that marks his optimal choice of studying and movie watching. How many movies does he watch each week?
With a new semester beginning, Rabil decides to get his difficult requirements out of the way. Each class
now requires him to study for 25 hours per week to get an A.
b) Draw the new budget constraint on your graph. Show one possible outcome on your diagram. How will the relative strengths of income and substitutions effects determine whether Rabil makes better or worse grade and whether he watches more or fewer movies?
Paper#9210856 | Written in 27-Jul-2016Price : $17.85