The ________________ graphically illustrates the possible combinations of two goods a consumer can purchase with a given income, given the prices of both products.

A)

production possibilities frontier

B)

supply curve

C)

budget line

D)

demand curve

1. A budget line shows:

A)

production possibilities.

B)

consumption possibilities.

C)

societal demands for goods.

D)

unlimited income.

3) The slope of the budget line is:

A)

negative, because of the marginal rate of substitution.

B)

positive, since income and prices are positive.

C)

zero, since both prices and income are assumed to be constant.

D)

negative, since to purchase more of one good means giving up some of the other good.

4) Xiao has a budget of $150 to spend on T-shirts and jeans. The jeans she likes cost $56, and t-shirts with her college logo on them cost $10. The combination of three t-shirts and three pairs of jeans would fall:

A)

inside the budget line.

B)

on the budget line.

C)

outside the budget line.

D)

cannot be determined based on the information.

5.

Tena has $50 per week to spend on lunches. Egg rolls cost $2 each and a plate of chow mein costs $7. Tena wants to buy five plates of chow mein and ten egg rolls per week. This combination of chow mein and egg rolls each week is:

A)

obtainable, but she would be spending every bit of her lunch money.

B)

obtainable, but she could buy more egg rolls.

C)

obtainable, but she could buy more chow mein.

D)

unobtainable.