Figure 6.6
-Refer to Figure 6.6.If the price of biscotti is $1.50 and the price of a cappuccino is $3.00, what is the slope of the budget constraint?
A)-2
B)-(3.00 - 1.50)/(3.00 + 1.50)= -1/3
C)-1/2
D)The slope cannot be determined without the value of income.

Question

Figure 6.6 
-Refer to Figure 6.6.If the price of biscotti is $1.50 and the price of a cappuccino is $3.00, what is the slope of the budget constraint?
A)-2 
B)-(3.00 - 1.50)/(3.00 + 1.50)= -1/3 
C)-1/2 
D)The slope cannot be determined without the value of income.

Quizplus · Accepted Answer

The slope of the budget constraint in a two-good model is calculated as the negative ratio of the price of one good to the price of the other. Here, it's -($3.00/$1.50) = -2.

Figure 6.6 -Refer to Figure 6.6.If the Price of Biscotti Is $1.50