The following figure shows the budget constraint of Lesley when she is faced with two goods: burgers and icecream.

-Refer to the figure above.If the price of a burger doubled,Lesley's new budget constraint ________.
A) will start from the same point on the vertical axis, but will cross the horizontal axis at 3
B) will start from the same point on the vertical axis, but will cross the horizontal axis at 12
C) will start from the same point on the horizontal axis, but will cross the vertical axis at 5
D) will start from the same point on the horizontal axis, but will cross the vertical axis at 20

Question

The following figure shows the budget constraint of Lesley when she is faced with two goods: burgers and icecream.
 
-Refer to the figure above.If the price of a burger doubled,Lesley's new budget constraint ________.
A) will start from the same point on the vertical axis, but will cross the horizontal axis at 3 
B) will start from the same point on the vertical axis, but will cross the horizontal axis at 12 
C) will start from the same point on the horizontal axis, but will cross the vertical axis at 5 
D) will start from the same point on the horizontal axis, but will cross the vertical axis at 20

Quizplus · Accepted Answer

When the price of a burger doubles, the quantity of burgers that can be purchased with a given budget decreases by half if all money is spent on burgers. This means the budget constraint will still start from the same point on the vertical axis (since the price of the other good and the total budget haven't changed), but it will cross the horizontal axis at a point that represents half the quantity of burgers that could be purchased before the price change.

The Following Figure Shows the Budget Constraint of Lesley When