A consumer can buy 5 units of good X and 4 units of good Y, if he spends his entire income. The price of good x is Rs 10 and that of y is Rs 12. Calculate the income of the consumer.
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Answer:
5 units
Explanation:
denotes quantity of Good-2. Thus, when the entire income of the consumer is spent on Good-1, he can buy 5 units of Good-1. Thus, when the entire income of the consumer is spent on Good-2, he can buy 4 units of Good-2. Accordingly, the budget line touches 4 units on Y-axis and 5 units on X-axis
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