4. An individual's budget Suppose Jacques has a weekly budget of $24 to spend on seltzer water and peanut butter. Seltzer water is priced at $2 per case, and peanut butter is priced at $6 per jar. If Jacques spends his entire $24 on seltzer water, he can buy jars of peanut butter. cases of seltzer water. If he spends his entire $24 on peanut butter, he can buy Use the blue line (circle symbol) to plot Jacques's budget constraint on the following graph. Next, use the orange point (square symbol) to shade the area that represents combinations of seltzer water and peanut butter that are affordable for Jacques. Finally, place the black point (plus symbol) on the point on Jacques's budget constraint that corresponds to a scenario in which Jacques spends $12 on each good. Note: Dashed drop lines will automatically extend to both axes. PEANUT BUTTER (Jars) 24 22 20 18 16 14 12 10 00 4 2 + 0 0 2 4 6 8 10 12 14 16 18 20 22 SELTZER WATER (Cases) 24 BC, ($24) Affordable Region $12 on Each BC2($48) What does the slope of Jacques's budget constraint represent? The cost of an additional jar of peanut butter in terms of dollars The opportunity cost of an additional jar of peanut butter in terms of cases of seltzer water O The cost of an additional case of seltzer water in terms of dollars O The opportunity cost of an additional case of seltzer water in terms of jars of peanut butter
4. An individual's budget Suppose Jacques has a weekly budget of $24 to spend on seltzer water and peanut butter. Seltzer water is priced at $2 per case, and peanut butter is priced at $6 per jar. If Jacques spends his entire $24 on seltzer water, he can buy jars of peanut butter. cases of seltzer water. If he spends his entire $24 on peanut butter, he can buy Use the blue line (circle symbol) to plot Jacques's budget constraint on the following graph. Next, use the orange point (square symbol) to shade the area that represents combinations of seltzer water and peanut butter that are affordable for Jacques. Finally, place the black point (plus symbol) on the point on Jacques's budget constraint that corresponds to a scenario in which Jacques spends $12 on each good. Note: Dashed drop lines will automatically extend to both axes. PEANUT BUTTER (Jars) 24 22 20 18 16 14 12 10 00 4 2 + 0 0 2 4 6 8 10 12 14 16 18 20 22 SELTZER WATER (Cases) 24 BC, ($24) Affordable Region $12 on Each BC2($48) What does the slope of Jacques's budget constraint represent? The cost of an additional jar of peanut butter in terms of dollars The opportunity cost of an additional jar of peanut butter in terms of cases of seltzer water O The cost of an additional case of seltzer water in terms of dollars O The opportunity cost of an additional case of seltzer water in terms of jars of peanut butter
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:4. An individual's budget
Suppose Jacques has a weekly budget of $24 to spend on seltzer water and peanut butter. Seltzer water is priced at $2 per case, and peanut butter is
priced at $6 per jar.
If Jacques spends his entire $24 on seltzer water, he can buy
jars of peanut butter.
cases of seltzer water. If he spends his entire $24 on peanut butter, he can buy
Use the blue line (circle symbol) to plot Jacques's budget constraint on the following graph. Next, use the orange point (square symbol) to shade the
area that represents combinations of seltzer water and peanut butter that are affordable for Jacques. Finally, place the black point (plus symbol) on
the point on Jacques's budget constraint that corresponds to a scenario in which Jacques spends $12 on each good.
Note: Dashed drop lines will automatically extend to both axes.
PEANUT BUTTER (Jars)
24
22
20
18
16
14
12
10
00
4
2
+
0
0
2
4
6
8 10 12 14 16 18 20 22
SELTZER WATER (Cases)
24
BC, ($24)
Affordable Region
$12 on Each
BC2($48)
What does the slope of Jacques's budget constraint represent?
The cost of an additional jar of peanut butter in terms of dollars
The opportunity cost of an additional jar of peanut butter in terms of cases of seltzer water
O The cost of an additional case of seltzer water in terms of dollars
O The opportunity cost of an additional case of seltzer water in terms of jars of peanut butter
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