Suppose a consumer has an income of $24, the price of A is $3, and the price of B is $1. Which of the following combinations is on the consumer's budget line?
A)4A and 10B
B)2A and 18B
C)8A and 24B
D)5A and 7B

Question

Quizplus · Accepted Answer

The budget line equation is P_A * Q_A + P_B * Q_B = Income. For B) 2A and 18B, the calculation is (2*$3) + (18*$1) = $6 + $18 = $24, which matches the consumer's income, placing it on the budget line.

Suppose a Consumer Has an Income of $24, the Price