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

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