This document serves as a guide to help reflect on my review of Assessment 1 for ECS2601. This is purely for reflection purposes and shows my decisions on the answers to the assessment as well as the marks I obtained for each answer.
Started on Monday, 3 April 2023, 8:36 PM
State Finished
Completed on Tuesday, 4 April 2023, 12:08 PM
Time taken 15 hours 32 mins
Marks 17.00/20.00
Grade 85.00 out of 100.00
Question 1
Correct
Mark 1.00 out of 1.00
In the long run, all costs are fixed.
Select one:
True
False
The correct answer is 'False'.
Question 2
Incorrect
Mark 0.00 out of 1.00
The two utility functions given below generate identical demand functions for goods X and Y:
a. U(X,Y) = log(X) + log(Y)
b. U(X,Y) = (XY)0.5
Select one:
True
False
True. If two utility functions are equivalent, the demand functions derived from them are identical. Two utility functions are equivalent if you
can transform one of them and get the other one. In this case, the functions generate identical demand functions.
The correct answer is 'True'.
, Question 3
Correct
Mark 1.00 out of 1.00
MENU
Lwazi views apples and oranges as perfect substitutes in his consumption, and MRS = 1 for all combinations of the two goods in his
Dashboard map.
indifference / MySuppose
courses the
/ ECS2601-23-S1 / R2
price of apples is Welcome
per bag,Message
the price/ofAssessment 1 per bag, and Lwazi’s budget is R30 per week. What is
oranges is R3
Lwazi’s utility maximizing choice between these two goods?
a.
10 bags of oranges and no apples.
b. 15 bags of apples and no oranges.
c. 5 bags of apples and 5 bags of oranges.
d. 4 bags of apples and 6 bags of oranges.
Figure 1.1
Given apples and oranges are perfect substitutes with MRS = 1, Lwazi’s indifference curves should be straight lines with slopes equal to -1
(as they are downward sloping). Also given his income is R30 per week, the price of apples is R2 each and the price of oranges is R3 each, we
can construct the budget line (BL) as shown in figure 1.1. That is, he can either use all his income to buy 15 apples or use all his income to
buy 10 oranges. His utility maximisation point will be a corner solution that he uses all his income to buy 15 apples, but no oranges, to get
him to IC3.
The correct answer is:
15 bags of apples and no oranges.
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