Natural Resources

Graphically illustrate the effects of an increase in autonomous consumption on the demand line (ZZ) and Y. Clearly indicate in your graph the initial and final equilibrium levels of output. Briefly explain why this increase in output is greater than (in absolute terms) the initial change in autonomous consumption

What will be an ideal response?

Stephan prefers practicing his keyboard everyday instead of writing articles for the local newspaper, despite the fact that the newspaper will pay him $10 for every 100 words he writes. This implies that: a. his labor supply curve is a horizontal straight line. b. he has a high opportunity cost of leisure

c. his labor supply curve is negatively sloped. d. he places a high value on time spent in leisure.