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Homework answers / question archive / Sam is willing to pay $12 per month for 1 green egg per month, $10 for the 2nd, $8 for the 3rd, etc

Sam is willing to pay $12 per month for 1 green egg per month, $10 for the 2nd, $8 for the 3rd, etc

Economics

Sam is willing to pay $12 per month for 1 green egg per month, $10 for the 2nd, $8 for the 3rd, etc. The market price of green eggs is $8. He is willing to pay $20 per month for 1 slice of ham per month, $16 for a 2nd, $12 for a 3rd, etc. The market price of ham slices is $12. (Assume Sam can only buy green eggs and ham in whole units.)

A. How many green eggs and ham slices do Sam purchase per month, and how much does he spend in total on each?

B. Which good provides Sam with the greatest net benefits? Would your answer be the same if green eggs cost $6?

C. How much would Sam be willing to pay to be able to purchase ham slices at $8 rather than $12?

Option 1

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