What information do you need to draw your budget line? What is your budget line? What does it show for any pair of goods?
What will be an ideal response?
To draw a budget line for any pair of goods, you need to know your income and the price of each good. The budget line shows all combinations of the two goods that you can afford. The slope of the budget line is the ratio of the prices and shows, therefore, the rate at which the market requires you to give up some of one for more of the other.
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An import quota will
A) lead to a shift of the demand curve. B) leave the equilibrium price unchanged and increase the quantity sold. C) limit the amount of a foreign good that can be brought into the United States. D) limit the amount of a good local producers can make.
Explain the adjustment process in the money market that creates a change in the price level when the money supply increases