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A Smith household allocates its income between housing q, which is measured in square feet and a composite good c Suppose the price of housing
- A Smith household allocates its income between housing q, which is measured in square feet and a composite good c Suppose the price of housing is $2.50 per square foot and let the composite good be measured in terms of dollars. Assuming a Smith household income is $2000 per month, answer the following questions.
- Draw the household's budget constraint by putting the quantity of housing on the x-axis.
- Draw the household's budget constraint if it is given a housing voucher equal to $500. Put the quantity of housing on the x-axis
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