Economics Today and Tomorrow, Student Edition
1st Edition
ISBN:9780078747663
Author:McGraw-Hill
Publisher:McGraw-Hill
Chapter7: Demand And Supply
Section7.3: The Law Of Supply And The Supply Curve
Problem 4R
Related questions
Question
- Draw a graph of Tarik’s budget line (bread on the y axis).
Identify the intercept:
Bread intercepts: Set S=0 in the budget constraint equation:
So, the bread intercept is (0,40).
Sausage intercept: Set B=0 in the budget constraint equation:
So, the sausage intercept is (35, 0).
Plot the Points:
Plot the point (0, 40) on the y-axis.
Plot the point (35, 0) on the x-axis.
Draw a graph of Tarik’s budget line (bread on the y axis).
Tarik consumes bread and sausages. He has decided that his monthly budget
will be $1400. Suppose that one bread costs $35, while one sausage costs $40.
i. What is the expression for Tarik’s budget constraint?
Draw the graph for this
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