Suppose that a consumer purchases just two goods, X and Y. The Y-intercept of the budget line in this case would indicate the

Question

Chasity Vargas

Mathematics

12 May, 01:40

Suppose that a consumer purchases just two goods, X and Y. The Y-intercept of the budget line in this case would indicate the

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Answers (1)

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Hunter Solomon · Answer 1

Y-intercept of the budget line would indicate the maximum quantity of good Y that the consumer can buy with the given income.

Step-by-step explanation:

Budget line is a graphical representation of the possible combinations of two goods X and Y which can be purchased with given income.

Its given that a consumer purchases just two goods, X and Y.

We need to tell that what does the Y-intercept of the budget line would indicate:

Solution:

Y-intercept of the budget line would indicate the maximum quantity of good Y that the consumer can buy with the given income.