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nakungth nakungth
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Posts: 1175
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6 years ago
Suppose you only consume food and clothing, and clothing is plotted on the vertical axis.  Also, you purchase food at a fixed price (PF), but the price of clothing declines as you buy in larger quantities (i.e., quantity discounts).  What does the budget line look like in this case?
A) The budget line is a straight line
B) The budget line is now concave to (bows out from) the origin
C) The budget line is now convex to (bows in toward) the origin
D) The budget line will not be a straight line, but it may be concave or convex
Textbook 
Microeconomics

Microeconomics


Edition: 8th
Author:
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