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Figure: Rita's Time Allocation Budget Line
-(Figure: Rita's Time Allocation Budget Line) Look at the figure Rita's Time Allocation Budget Line. It is based on 80 hours available for labor and leisure. If her hourly wage doubles, the vertical intercept will be:
A) $1,120.
B) $1,400.
C) $1,600.
D) $2,000.

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Use the following to answer questions:
Figure: Rita's Time Allocation Budget Line 
-(Figure: Rita's Time Allocation Budget Line) Look at the figure Rita's Time Allocation Budget Line. It is based on 80 hours available for labor and leisure. If her hourly wage doubles, the vertical intercept will be:
A) $1,120. 
B) $1,400. 
C) $1,600. 
D) $2,000.

Quizplus · Accepted Answer

If her hourly wage doubles, the vertical intercept will double. The original vertical intercept is $700, so the new vertical intercept will be $1,400.

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