Suppose that the quantity of good y is measured along the vertical axis and that the quantity of good x is measured along the horizontal axis. If the price of good x is $5 and the price of good y is $10 when income is $200 per time period, the slope of the consumer's budget constraint will be
A) -0.5.
B) -2.
C) -5.
D) -10.

Question

Quizplus · Accepted Answer

The slope of the budget constraint is given by the negative ratio of the price of good x to the price of good y, which is -5/10 = -0.5.

Suppose That the Quantity of Good Y Is Measured Along