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Construct budget constraint-draw john budget line

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Reference no: EM132505385

Consider John who consumes two goods, (X and Y), with prices Px=$24, Py=$12 and income I=120

i) Construct budget constraint

ii) Draw John's budget line with good X on the Horizontal axis

iii) Use a graph to show the effect of in income from $120 to $150

iv) What will happen to the slope of the budget line if the price of good X decreases to $18?

Reference no: EM132505385

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