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Read the report carefully and answer the questions based on the report:

Consumer’s Budget₹ 100
Price of Good X₹ 5 per unit
Price of Good Y₹ 10 per unit

On the basis of given data above, the correct equation of price line will be.

Solution

✅ Correct Option: 3

Option 1 -> Uses variables X and Y without proper notation for quantities.

Option 2 -> Uses variables X and Y without proper notation for quantities.

Option 3 -> Uses proper notation Qx and Qy for quantities, with coefficients 5 and 10 representing prices.

Option 4 -> Uses proper notation but with different price coefficients (10 and 5 reversed).


Hence, 5Qx + 10Qy = 100 -> This is the correct budget line equation where Px = 5 (price of good X), Py = 10 (price of good Y), and M = 100 (income/budget). The budget line equation format is: Px·Qx + Py·Qy = M, where Qx and Qy represent quantities of goods X and Y respectively. This equation shows all combinations of goods X and Y that a consumer can purchase with the given budget and prices. -> correct

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