Use the following to answer questions:
Figure: Budget Constraint 2
-(Figure: Budget Constraint 2) Refer to the figure. What is the relative price of music downloads to movie downloads?
A) 3
B) 1/3
C) 5
D) 4

Question

Use the following to answer questions:
Figure: Budget Constraint 2 
-(Figure: Budget Constraint 2) Refer to the figure. What is the relative price of music downloads to movie downloads?
A) 3 
B) 1/3 
C) 5 
D) 4

Quizplus · Accepted Answer

The relative price of music downloads to movie downloads is the slope of the budget constraint, which is the price of music downloads divided by the price of movie downloads. If the slope is 1/3, it means that one movie download is equivalent to three music downloads in terms of cost.

Use the Following to Answer Questions