Answer to Question #154088 in Microeconomics for Shan

Question #154088

Mary optimizes her satisfaction when she consumes 10 books (B) and 5 apples (A) each month. Mary's monthly income is $ 50 and she currently spends $ 10 on apples. Write Mary's budget line in slope intercept form with books measured on the vertical axis.

Expert's answer

Pa = $10/5 = $2.

"Pb = (50 - 10)\/10 = 4" $.

Mary's budget line is 2A + 4B = 50 or B = 12.5 - 0.5A.

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