Amina has $200 to spend on fishing equipment and fast-food burgers. Fishing equipment is priced at $10 per unit and fast-food burgers are priced at $4 per burger.
a. Graph Amina's budget constraint, placing fishing equipment on the vertical axis and fast-food burgers on the horizontal axis. Using an indifference curve, show Amina's optimal consumption bundle at 10 units of fishing equipment and 25 burgers.
b. Suppose that Amina's income increases by $50. Adding a new budget constraint and indifference curve to your original graph, show Amina's new optimal consumption bundle, assuming fishing equipment is a normal good and fast-food hamburgers are an inferior good.

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The Answer of Amina has $200 to spend on fishing equipment and fast-food burgers. Fishing equipment is priced at $10 per unit and fast-food burgers are priced at $4 per burger.
a. Graph Amina's budget constraint, placing fishing equipment on the vertical axis and fast-food burgers on the horizontal axis. Using an indifference curve, show Amina's optimal consumption bundle at 10 units of fishing equipment and 25 burgers.
b. Suppose that Amina's income increases by $50. Adding a new budget constraint and indifference curve to your original graph, show Amina's new optimal consumption bundle, assuming fishing equipment is a normal good and fast-food hamburgers are an inferior good.

Amina Has $200 to Spend on Fishing Equipment and Fast-Food