question archive Abraar consumes only pizza and spaghetti for his meals
Abraar consumes only pizza and spaghetti for his meals
Subject:EconomicsPrice: Bought3
Abraar consumes only pizza and spaghetti for his meals. Abraar spends £100 on his meals each week. The price of a slice of pizza is £1 and the price of a bowl of spaghetti is £2.
a. Draw Abraar’s budget constraint.
b. If the price of spaghetti doubles to £4, what will happen to Abraar’s opportunity set? Show this on a graph.
c. If the price of spaghetti doubles to £4, the price of pizza doubles to £2, and income doubles to £200, will Abraar be better off, worse off, or the same? Explain.
