-Given the budget line in the above figure, what is the household's real income in terms of pizzas per month?
A) 5 pizzas per month
B) 4 pizzas per month
C) 3 pizzas per month
D) All of above represent the household's real income.

Question

-Given the budget line in the above figure, what is the household's real income in terms of pizzas per month?
A) 5 pizzas per month 
B) 4 pizzas per month 
C) 3 pizzas per month 
D) All of above represent the household's real income.

Quizplus · Accepted Answer

The household's real income in terms of pizzas per month is determined by the maximum number of pizzas they can purchase if they spend all their income on pizzas. If the budget line intersects the pizza axis at 5, then the real income is 5 pizzas per month.

-Given the Budget Line in the Above Figure, What Is