The slope of the budget line can be interpreted as which of the following?
A) an opportunity cost
B) the consumer's budget divided by the price of the good measured on the y-axis
C) the consumer's budget divided by the price of the good measured on the x-axis
D) the number of units of the good measured on the y-axis plus the number of units of the good measured on the x-axis
E) the budget necessary to buy the combinations of goods on the budget line

Question

Quizplus · Accepted Answer

The slope of the budget line represents the opportunity cost of one good in terms of the other. It shows how many units of one good a consumer must give up to obtain an additional unit of another good, given their budget constraint.

The Slope of the Budget Line Can Be Interpreted as Which