MS: Proble × Problems: E × G The follow X v G Megan de x Q MicroCh 6 x G Assume

Question

MS: Proble × Problems: E × G The follow X v G Megan de x Q MicroCh 6 x G Assume the x G Suppose th >. G suppose th ? YG suppose th × KCSecure https://www.flipitecon.com/Course/ViewProblem?unitltemID-36173208enrollmentID-315623 Mastery Item 1) Recognizing a budget line and how it is calculated using prices and budget Score Threshold: 100.0 3) Determining the price of a good based on a budget line diagram Mastery Item Check for Mastery 1) Assume that a consumer with S30 to spend on plzzas and wall climbing has the budget line in the figure below. what Mastery Item 2) Determining whether a bundle is affordable or not affordable Score Threshold: 100.0 is the price of a pizza? Mastery item 3) Determining the price of a good based on a budeet line diagram Score Threshold: 100.0 Mactary ttam 4) Pivots to the budget line when the price of one good changes Item Completed Mastery item 5) Parallel shifts of the budget line when income changes Score Threshold: 100 Wall Clmbing (hours) .0 a) $6 b) $25 c) S18 O d) $12 Submit Mastary ttam 6) Utility maximization Score Threshold: 100.0 aI macmillan 802 PM O Type here to search 7/26/2018

Explanation / Answer

Option a - $6

The budget line equation is:

P1*x + P2*y = M

where P1 = price of wall climbing,
P2 = Price of Pizza
x = Wall Climbing (hours)
y = Pizza(number)

Note that when y = 5 then x = 0 (see graph) and M = 30.

P1*0+P2*5 = 30
P2*5 = 30
P2 = 6

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