Prior to 1979, the food stamp program required families to pay a certain amount for food stamps. Suppose a family can receive $ 150 in food stamps for a payment of $ 50; no other options are offered. How would this policy affect the budget line? Compared with an outright gift of $ 100 in food stamps, which is the way the program now works, would this policy lead to more, less or the same food consumption?
Answer to relevant QuestionsUsing an indifference map, explain why U.S. parents with two children both of the same sex are more likely to go for a third child than are parents with one child of each gender.Is it inconsistent to claim that (a) people’s preferences differ and (b) at their current consumption levels, their marginal rates of substitution are equal?Explain how the indifference curve and budget line apparatus are used to derive a consumer’s demand curve. For a demand curve, certain things are held constant. What are they, and how does this approach hold them constant? Define consumer surplus, and explain how you would show it in a diagram containing a demand curve for some product. What would consumer surplus equal in Figure if the demand was perfectly elastic at the market price of $ 3 ...Tony currently goes to the dentist twice a year at $ 150 per visit. His employer subsidizes Tony’s purchases by paying half the cost of each dental visit in excess of one visit per year. (No subsidy is granted on the first ...
Post your question