The Graph of the Budget Line Below Has Dollars on the Vertical

question 31

Multiple Choice

The graph of the budget line below has dollars on the vertical axis and food on the horizontal axis. Which statement is false?

• A)The vertical intercept represents all money available for purchasing.
• B)The distance OA shows the amount of money spent on OD amount of food.
• C)If the amount of money available is known in this graph, then the absolute and relative price of food is known also.
• D)The horizontal intercept represents all the food the consumer could purchase with the budget available.

---

Definitions:

Satisfy Wants

The process of fulfilling the desires or needs of consumers through the provision of goods and services.

Marginal Cost Curve

A graphical representation that shows how the cost of producing one additional unit of a good changes as the quantity of production is increased.

Increasing Marginal Opportunity Costs

Represents the concept that each additional unit of a good or service produced requires the sacrifice of increasingly more valuable alternatives.

Specific Product

A particular product identified by its unique characteristics or defined specifications, distinguishing it from other products.