Guy Has an Income (Y)of $50 with Which He Can

question 118

Multiple Choice

Guy has an income (Y) of $50 with which he can purchase DVDs (D) at $10 each and haircuts (H) at $20 each.Which one of the following represents Guy's budget line?

• A)Y = 10Q_D - 20Q_H
• B)50 = Q_D + Q_H
• C)Y = 50 + Q_D + Q_H
• D)20Y = Q_D + 10Q_H
• E)50 = 10Q_D + 20Q_H

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Definitions:

Colgate Doctrine

A legal principle allowing manufacturers to set minimum retail prices for products under certain conditions without violating antitrust laws.

Suggested Resale Prices

Recommendations made by manufacturers or wholesalers on the price at which goods should be sold to the public.

Sherman Act

A landmark federal statute in the antitrust law that prohibits monopolistic practices and promotes competition.

Domestic Corporation

A company that is registered, established, and operates within the legal jurisdiction of its home country.