The Budget Constraint for a Consumer Who Only Buys Apples

question 42

Multiple Choice

The budget constraint for a consumer who only buys apples (A) and bananas (B) is P_AA + P_BB = I where consumer income is I, the price of apples is P_A, and the price of bananas is P_B. To plot this budget constraint in a figure with apples on the horizontal axis, we should use a budget line represented by the slope-intercept equation:

• A) A = -I/P_A + (P_B/P_A)B
• B) A = I/P_A - (P_B/P_A)B
• C) B = -I/P_B + (P_A/P_B)A
• D) B = I/P_B - (P_A/P_B)A

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Definitions:

Economic Effects

The impact of various factors on the economy, including policies, market trends, and social changes, affecting business performance and societal welfare.

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The formal termination of a marriage through a court or authorized entity.

Polygamy

A marriage system in which an individual has multiple spouses at the same time.

Social Organization

The structured arrangement of societal roles and responsibilities, forming the framework within which society operates.