Question

Tonya's budget constraint for gallons of gasoline (G) and shirts (S) each month can be expressed by the equation G = 100 – 2S, where G is the number of gallons of gasoline she buys and S is the total number of shirts she buys. Assume that she spends her entire budget each month. If the price of shirts is $10, which consumption bundle lies INSIDE Tonya's budget line?

a.) 50 units of clothing and 100 units of gasolineb.) 50 units of clothing and 0 units of gasolinec.) 0 units of clothing and 100 units of gasolined.) 5 units of clothing and 10 units of gasoline

Answer 1

a.) 50 units of clothing and 100 units of gasoline

Step-by-step explanation:

Since G = 100 – 2S

When Tonya bought zero unit of gasoline, we have G = 0.

Therefore,

100 - 2S = 0

2S = 100

S = 100/2

S = 50

When Tonya bought zero unit of shirts, we have, we have S = 0

Therefore, G = 100 - 2(0)

G = 100

Therefore, If the price of shirts is $10, which consumption bundle lies INSIDE Tonya's budget line 50 units of clothing and 100 units of gasoline.

Answer 2

a). 1000$

b). 500$

c). 500$

d). 100$

Step-by-step explanation:

1. 
   `G= 100- 2* S`

Budget constraint is the relation between the price of the gallons of gasoline and shirts, knowing the price of the shirts can write down the equation:

2.
`I= Price Gasoline * G + Price Shirts * S`

`I= Income` ,
`Price Shirts= 10$`

From equation 1 know the price of gasoline and the income so now can figure each scenery

`G= (I)/(PriceGasoline)- (PricesShirt)/(PriceGasoline) * S`

`Price Gasoline= 5$ \\Income= 500$`

a).

`I=PriceG*G +PriceS*S\\I= 5*100+10*50`

`I=1000$` is the double of the budget

b).

`I=PriceG*G +PriceS*S\\I= 5*0+10*50`

`I=500$` is all the budget

c).

`I=PriceG*G +PriceS*S\\I= 5*100+10*0`

`I=500$` is all the budget

d).

`I=PriceG*G +PriceS*S\\I= 5*10+10*5`

`I=100$` is lower that the budget