Question: 1/ Paula, a former actress, spends all her income attending plays and movies and likes plays exactly three times as much as she likes movies.

1/ Paula, a former actress, spends all her income attending plays and movies and likes plays exactly three times as much as she likes movies.

Draw her indifference map.

Paula has $120/wk budget for entertainment (watching plays and movies). If play tickets cost $12 each and movie tickets cost $4 each, show her budget line and highest attainable curve. How many plays and how many movies will she see If play tickets are $12 movie tickets $5?

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StepbyStep Solution Step 1 Define the Utility Function Since Paula likes plays exactly three times as much as she likes movies M we can express her ut... View full answer

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