Harvey's Net Demands for Goods 1 and 2 Are (2

question 53

Essay

Harvey's net demands for goods 1 and 2 are (2, -3)and his endowment is (6, 5).
a.What are his gross demands?
b.Draw a diagram illustrating his budget line, his endowment, and his consumption.(Put good 1 on the horizontal axis.)
c.Draw a dotted line to show what his budget line would be if the price of good 1 doubled and the price of good 2 stayed the same.

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Definitions:

Extrinsic Benefits

Advantages or rewards received from an activity that are external to the activity itself, such as money, grades, or recognition.

Self-Efficacy

An individual's belief in their own capability to execute behaviors necessary to produce specific performance attainments.

Job Security

The probability or likelihood that an individual will retain his or her job or employment position without involuntary separation.

Training Hours

The total time spent in training activities, usually measured in hours, aimed at skill improvement or acquisition.