In the graph, which bundles can the consumer afford? A budget line for M = ₹100, P₁ = ₹5, P₂ = ₹10, running from 10 units of good 2 (no good 1) to 20 units of good 1 (no good 2). Bundle A is (8, 6), bundle B is (10, 6) and bundle C is (6, 4).

In the graph, which bundles can the… — CUET Economics practice

In the graph, which bundles can the consumer afford?

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In the graph, which bundles can the consumer afford?

A, B and CCorrect answerYour answerOnly BCorrect answerYour answerA and CCorrect answerYour answerOnly CCorrect answerYour answer

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CorrectNot quiteAnswer C

Correct answer: C

A costs 8 × ₹5 + 6 × ₹10 = ₹100: on the budget line, affordable.
C costs 6 × ₹5 + 4 × ₹10 = ₹70: inside the line, affordable. B costs 10 × ₹5 + 6 × ₹10 = ₹110: beyond the income.

Ten questions from Budget Line & Optimal Choice, at your own pace.

Ten questions from Budget Line & Optimal Choice, at your own pace.