Suppose that the price of soda remains at $l a can but the price of coffee rises

Question:

Suppose that the price of soda remains at $l a can but the price of coffee rises to $3 a cup. Draw Amy’s new budget line. If she buys 6 cans of soda, what is the maximum number of cups of coffee she can buy in a week? Has the relative price of coffee changed?

Amy has $12 a week to spend on coffee and soda. The price of coffee is $2 a cup, and soda is $1 a can.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Foundations Of Economics

ISBN: 9780135897478

9th Edition

Authors: Robin Bade, Michael Parkin

Question Posted: