Alex Distributes His Monthly Income of $600 Between Two Goods,movies,and

question 9

Multiple Choice

Alex distributes his monthly income of $600 between two goods,movies,and food.By spending his entire income on movies,he can enjoy a maximum of 20 movies.On the other hand,by spending his entire income on food he can consume a total of 60 units of food.Assume that food consumption is measured along the horizontal axis and the consumption of movies is measured on the vertical axis.What will be the slope of Alex's budget line when the maximum possible movie consumption declines to 15,all other things remaining the same?

• A)-0.5
• B)-0.25
• C)-1
• D)-0.47

---

Definitions:

Pure Competition

A market structure characterized by a large number of small firms, a homogeneous product, and very easy entry and exit conditions, leading to price-taking behavior.

Advertising

Advertising is a marketing communication strategy used to promote or sell a product, service, or idea through various media channels.

Market Models

Theoretical frameworks that describe how different market structures operate, including competition, monopolies, and oligopolies.

Monopolistic Competition

A market structure characterized by many firms selling products that are similar but not identical, allowing for significant product differentiation and some control over price.