Answered: 7. Suppose the consumer buys pizza and…

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter21: The Theory Of Consumer Choice

Section: Chapter Questions

Problem 5CQQ

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7. Suppose the consumer buys pizza and soda. The price of pizza is $15 and the price of
soda is $3. The consumer’s income is $180. Suppose that soda is measured on the x-axis
and pizza is measured on the y-axis.
(a) The slope of the budget line is -1/5. The intercept on the y axis is 12 and the intercept
on the x axis is 60
(b) The slope of the budget line is -1/5. The intercept on the y axis is 15 and the intercept
on the x axis is 3
(c) The slope of the budget line is -5. The intercept on the y axis is 12 and the intercept
on the x axis is 60
(d) The slope of the budget line is -5. The intercept on the y axis is 60 and the intercept
on the x axis is 12

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