Let the income of the consumer be Rs 4000, price of good x be Rs 100, and price of good y be Rs 250. (i) Construct a budget line. (ii) Find the slope of the budget line.
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By connecting these two extremes, you can find every combination that José can afford along his budget line . For example, at point R, José buys 2 T-shirts and 4 movies. This costs him:
T-Shirts @ $14 x 2 = $28
Movies @ $7 x 4 = $28
Total = $24 + $28 = $56
This point indeed exhausts José’s
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