Answer to Question #64567 in Microeconomics for fakhr hijazi

Question

1. Assume you are about to graduate and you have several family members that are interested in attending the ceremony. You only have 100$ to spend this month (no one will lend you any money) and you are expected to buy the tickets to graduation. So, this month you will only consume tickets, T, and a composite commodity, X.
The price of a ticket is 10 $ and you plan on buying 4 tickets (the price of the composite commodity, X, is 1 $)
But the university makes a special offer. You may join the Alumni Association for 20 $, and then you can buy tickets for 5 $ each (note that joining the Alumni Association holds absolutely no interest to you-it provides no extra utility).
Verbally and graphically explain whether you will join the Alumni Association to get the cheaper tickets. ANY SOLUTION FOR THIS

Answer 1

Joining the association can be profitable and unprofitable to you according to the number of tickets consumed. If you buy more than 4 tickets to the final, then you need to join the association. And if you buy less than 4 tickets, then you will be unprofitable.