What is a budget line? What does the point on it indicate in terms of prices?
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The budget line is an important component when analyzing consumer behavior. The budget line illustrates all the possible combinations of two goods that can be purchased at given prices and for a given consumer budget.The amount of a good that a person can buy will depend upon his income and the price of the good he is purchasing. that's all
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"A budget line or price line represents the various combinations of two goods which can be purchased with a given money income and assumed prices of goods"
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