Question

The figure below shows the budget constraint of a consumer with an income of 900/- to spend on two
commodities, namely ice cream and chocolates.
90
Quantity of Chocolates
45
Quantity of cups of ice cream
The prices of these two commodities respectively are:
(a) 10 and 20
(b) 20 and 10
(c) 10 and 5
(d) Any of the above.​

Answer 1

The price of the commodities would be Rs. 10 for every chocolate and Rs. 5 for ice cream.

Explanation:

Given,

Budget Constraint = Rs. 900

Let the price of ice cream be x and the price of chocolates to be y

Quantity of ice cream + quantity of chocolates = 135

So,

x + y = 135 ...(1)

and the price of the two goods

90x + 45y = 900 ...(2)

by solving the two equations,

x + y = 135

90x + 45y = 900

We get,

x = Rs. 5

To verify,

90 * 5 + 45 * y = 900

45y = 450

y = 450/45

y = Rs. 10

Thus, the price of Rs. 5 for ice cream and Rs. 10 for chocolate.

Learn more: Budget Constraint

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Answer 2

Answer:

the answer for this question is option b