1.What does a household's budget line show? 2.How does the relative price and a household's real income influence its budget line? 3.lf a household has an income of $40 and buys only bus rides at $2 each and magazines at $4 each what is the eguation of the household's

ENGR.ECONOMIC ANALYSIS
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ISBN:9780190931919
Author:NEWNAN
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Chapter1: Making Economics Decisions
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1.What does a household's budget line show?
2.How does the relative price and a household's
real income influence its budget line?
3.lf a household has an income of $40 and buys
only bus rides at $2 each and magazines at $4
each, what is the equation of the household's
budget line?
4.lf the price of one good changes, what
happens to the relative price and the slope of
the household's budget line?
5.lf a household's money income changes and
prices do not change, what happens to the
household's real income and budget line?
Transcribed Image Text:1.What does a household's budget line show? 2.How does the relative price and a household's real income influence its budget line? 3.lf a household has an income of $40 and buys only bus rides at $2 each and magazines at $4 each, what is the equation of the household's budget line? 4.lf the price of one good changes, what happens to the relative price and the slope of the household's budget line? 5.lf a household's money income changes and prices do not change, what happens to the household's real income and budget line?
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