Question

The price of a cup of coffee is​ $2.00 and the price of a cookie is​ $1.00. Mary has​ $8 a day to spend on coffee and cookies. Draw​ Mary's budget line. Label it. The budget line marks the boundary between​ ______. A. what Mary can afford and what she cannot afford B. what Mary would like to buy and what she would not like to buy C. what Mary wants and what Mary needs D. what is essential and what is a luxury good for Mary

Answer 1

Answer:

A. what Mary can afford and what she cannot afford

Explanation:

The line will be the combination between Cookies and coffees she can afford with his daily income of 8

She can afford to purchase any combination on the line or below the line

for example,

She can buy either 4 coffees = 8

3 coffees 2 cookies = 8

2 coffee 4 cookies = 8

1 coffe 6 cookies = 8

8 cookies = 8

or just 1 coffe = 2

She cannot afford above the line

4 coffe and 3 cookies = 4*2 + 3 *1 = 11