Graph 22-3
-Refer to Graph 22-3.Using the figure in panel (a), if income is equal to $160, the price of good Y is:
A)$1.20
B)$3.20
C)$2.66
D)$8.00

Question

Graph 22-3 
-Refer to Graph 22-3.Using the figure in panel (a), if income is equal to $160, the price of good Y is:
A)$1.20 
B)$3.20 
C)$2.66 
D)$8.00

Quizplus · Accepted Answer

The budget line in panel (a) shows the combinations of goods X and Y that can be purchased with an income of $160. If the intercept on the Y-axis is 50, then the price of good Y can be calculated as $160/50 = $3.20.