When the price level falls, consumers may feel wealthier and the consumption function will shift upward.

If Sam has $80.00 each week to spend on tacos and magazines, and their respective prices are $.50 per taco and $4.00 per magazine, which of the following equations represents his budget line?

A) $80.00 = $.50/Qt + $4.00/Qm B) $80.00 = Qt/Qm + $.50 /$4.00 C) $80.00 = $.50(Qm) + $4.00(Qt) D) $80.00 = $.50(Qt) + $4.00(Qm)

In the figure above, Gap maximizes its profit if it charges ________ per jacket

A) $100 B) $95 C) $75 D) $120