Q. Draw a graph with arcade games on the horizontal axis also newspapers on the vertical axis. Joe has $10 every week to allocate between these commodities. The price of newspapers is $0.50. At the initial price for arcade games of $0.25, Joe purchases 10 newspapers also plays 20 games. Whenever the price of games increases to $0.50, Joe purchases 8 newspapers also plays 12 games. Whenever the price of games increases again to $0.75, Joe buys 5 papers also plays 10 games.
a. Use this information to draw the utility maximizing points on a graph.
b. Draw the price-consumption curve.
c. Draw the individual demand curve for arcade games.
d. Use the information given to compute Joe's elasticity of demand for arcade games between $0.25 also $0.50, also between $0.50 also $0.75.