Economics 9708 · AS & A Level · Indifference curves and budget lines

Indifference curves and budget lines — practice question

Brand X costs $2 and brand Y costs $1. This consumer has an income of $20 to spend on these brands. Which combinations of the two brands could lie on the same budget line for this consumer?

  • AAll three combinations (0 units of X & 20 units of Y; 5 units of X & 10 units of Y; 10 units of X & 0 units of Y) are on the same budget line.
  • BOnly 0 units of X and 20 units of Y is on the budget line.
  • C0 units of X and 20 units of Y, and 10 units of X and 0 units of Y are on the budget line but 5 units of X and 10 units of Y is not.
  • D0 units of X and 20 units of Y, and 5 units of X and 10 units of Y are on the budget line but 10 units of X and 0 units of Y is not.

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