- P1 = Rs 10
P2 = Rs 10
M = Rs 40
$\text{Budget set}=\text{P}_1\text{x}_1+\text{P}_2\text{x}_2\leq40\text{M}$
$10\text{x}_1+10\text{x}_2\leq40$
The bundles that are available to the consumer should cost less than or equal to Rs 40.
$\text{Horizontal intercept }=\frac{\text{M}_2}{\text{P}_1}=\frac{40}{10}=4$
$\text{Vertical intercept}=\frac{\text{M}^2}{\text{P}_2}=\frac{40}{10}=4$
$\text{Slope}=\frac{-\text{P}_1}{\text{P}_2}=\frac{-10}{10}=-1$
- The bundles in the shaded region $(\triangle\text{AOB})$ are all available to the consumer, including the bundles lying on the line AB.
(0, 0) (0, 1) (0, 2) (0, 3) (0, 4)
(1, 0) (1, 1) (1, 2) (1, 3) (2, 0)
(2, 1) (2, 2) (3, 0) (3, 1) (4, 0)
The coordinates that lie on the line AB cost exactly the same as the income of the consumer. The bundles are as follows:
(0,4) (1,3) (2,2) (3,1) (4,0)