If the Consumer's Budget Constraint Is Given by 4P

question 8

Multiple Choice

If the consumer's budget constraint is given by 4P + 2B = 50 where P is pizza and B is burgers, the following bundles of pizza and burger would be on the budget constraint:

• A)P = 2; B = 21
• B)P = 5; B = 10
• C)P = 2; B = 24
• D)P = 10; B = 20

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Definitions:

Margin Deposit

A deposit required by a broker from a client when they borrow from the broker to buy securities, serving as collateral for the loan.

Long Positions

Investing strategy where an investor buys a security with the expectation that it will increase in value.

Short Positions

An investment strategy where an investor sells borrowed securities with the intention of buying them back at a lower price to profit from a price decline.

Delivery Date

The specific date on which the delivery of the commodities, securities, or other assets is scheduled to occur in a contract.