Suppose the price of A is $20 per unit, the price of B is $10 per unit, and the consumer's income is $1000 per month. Which of the following baskets is not on the consumer's budget line?
A) $A = 40 , B = 20$
B) $A = 5 , B = 90$
C) $A = 2.5 , B = 95$
D) $A = 20 , B = 40$

Question

Suppose the price of A is $20 per unit, the price of B is $10 per unit, and the consumer's income is $1000 per month. Which of the following baskets is not on the consumer's budget line? 
A) $A = 40 , B = 20$
B) $A = 5 , B = 90$
C) $A = 2.5 , B = 95$
D) $A = 20 , B = 40$

Quizplus · Accepted Answer

The budget line equation is $20A + 10B = 1000$. For option D, $20(20) + 10(40) = 400 + 400 = 800$, which is not equal to 1000, so it is not on the budget line.

Suppose the Price of a Is $20 Per Unit, the Price