The diagram shows Sam's budget line. Sam's budget line shows401648.12162024Coffee (pounds per week)O A. which combinations of gasoline and coffee Sam can afford.B. which combinations of gasoline and coffee Sam is planning to purchase.OC. whether or not Sam thinks gasoline and coffee are worth their prices.OD. whether or not Sam currently has enough gasoline and enough coffee.3224Gasoline (gallons per week)

Budget line is a combination of prices of two commodities that a consumer can purchase with limited given income. Given the definition of the budget line answer (b), (c) and (d) seem incorrect; because (b) explains the plan to purchase which is not what the budget line depicts and (c) talks about the worth of the price of the commodity which is not the budget line depicts and finally the budget line does not explain how much commodity the consumer has thus, (d) is also incorrect.The correct option is (a) that the budget line is a combination of gasoline and coffee that Sam can afford.

Answered: The diagram shows Sam's budget line.…

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Economics

The diagram shows Sam's budget line. Sam's budget line shows

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

The diagram shows Sam's budget line. Sam's budget line shows
40
16
4
8.
12
16
20
24
Coffee (pounds per week)
O A. which combinations of gasoline and coffee Sam can afford.
B. which combinations of gasoline and coffee Sam is planning to purchase.
OC. whether or not Sam thinks gasoline and coffee are worth their prices.
OD. whether or not Sam currently has enough gasoline and enough coffee.
32
24
Gasoline (gallons per week)

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