Given the following budget line PxX + Pyy = m And that the slope of the budget line depends only on relative prices, show what happens to the budget line when: (a) Px rises (b) m reduces (c) Both px and py rise by the same proportion X, (d) a consumer is given an in-kind transfer of 40 units of good y (e) the government imposes a quantity tax (t) on good y

Given the following budget line PxX + Pyy = m And that the slope of the budget line depends only on relative prices, show what happens to the budget line when: (a) Px rises (b) m reduces (c) Both px and py rise by the same proportion X, (d) a consumer is given an in-kind transfer of 40 units of good y (e) the government imposes a quantity tax (t) on good y

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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