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:

Profit-Maximizing Output

The level of production at which a firm achieves the highest profit, where marginal cost equals marginal revenue.

Competitive Firm

A company that operates in a market where it must accept the prevailing prices set by the market through supply and demand.

Variable Factors

Inputs or resources whose usage level can be altered in the short run to influence the level of output produced.

Warehouse Space

The area available in a warehouse used for the storage of goods.