If Xavier's Budget Constraint Is Represented in the Graph Shown

question 9

Multiple Choice

If Xavier's budget constraint is represented in the graph shown, and the price of a bag of chips is $3, what is Xavier's income?

• A)$9
• B)$27
• C)$12
• D)Cannot answer this without knowing the price of soda.

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Definitions:

Banker's Lobbying

The efforts made by banks and financial institutions to influence lawmakers and regulators in favor of policies beneficial to their interests.

Subprime Mortgage

Mortgage for a borrower with a not-so-good credit rating.

Credit Rating

An assessment of the creditworthiness of a borrower in general terms or with respect to a particular debt or financial obligation.

Prime Rate

The interest rate that commercial banks charge their most creditworthy customers, typically used as a benchmark for many other loans and credit products.