If a Consumer Has $30 to Spend on Apples and Bananas

question 69

Multiple Choice

If a consumer has $30 to spend on apples and bananas, where on the apple axis would the consumer's budget line intersect if the price of apples is $3 a kilogram?

• A) 10 kilograms
• B) 30 kilograms
• C) 3 kilograms
• D) Zero kilograms
• E) It is impossible to determine with the given information.

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Definitions:

Active Portfolio

An investment strategy where the portfolio manager makes specific investments with the goal of outperforming an investment benchmark index.

Nonsystematic Variance

The portion of a security's variance that is unique to the specific security and can be mitigated through diversification.

Market Index

An aggregate value produced by combining several stocks or other investment vehicles together and expressing their total values against a base value from a specific date.

Active Portfolio

An active portfolio refers to a collection of investments that are managed and regularly adjusted by portfolio managers in an attempt to outperform the market.