Question

Draw Marie’s budget constraint with pies on the horizontal axis and magazines on the vertical axis. What is the slope of the budget constraint?

Short answer

The slope of the budget constrain is -3.

Step-by-step solution

Step 1. Given information

Price of Magazine= $4

Price of Pies= $12

the maximum magazines she can buy= 6

the maximum pies she can buy= 2

Step 2. Calculation

The budget constraint shows all possible combinations of consumption that someone can afford given the prices of goods and the individual's income.

$$\begin{gathered} m=\frac{y2-y1}{x2-x1} \\ m=\frac{6-0}{0-2} \\ m=\frac{6}{-2} \\ m=-3 \end{gathered}$$

So, slope of the budget line = -3