Suppose John Is Planning to Join a Sports Club $y = 900 - 5 x$

question 79

Multiple Choice

Suppose John is planning to join a sports club. Membership in the club will allow John to swim at the pool for half price. Normally swimming for an hour would cost $10. If John has an income of $1000, the club membership fee is $100, and we plot the number of visits to the pool on the horizontal axis and a composite "other goods" which have a price of $1 on the vertical axis, the equation of John's budget line after joining the club, where the composite good, y, is on the vertical axis and pool visits, x, are measured on the horizontal axis is:

• A) \(y = 900 - 5 x\)
• B) \(y = 1000 - 5 x\)
• C) \(y = 1000 - 10 x\)
• D) \(y = 900 - 10 x\)

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Definitions:

Transfer

The act of moving assets, securities, or other valuables from one party to another.

Lockbox System

A service provided by banks to companies for the collection of payments from customers, involving the use of a special post office box to speed up the deposit process.

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Short-term government securities issued at a discount from the face value and mature in a year or less, used to raise funds and manage the money supply.