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Give Equation of Budget Line.

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Question

Give the equation of Budget Line.

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Solution

The equation of the budget line:
P1X1 + P2X2 = M
Where,
P1 - per unit price of Good 1
P2 - per unit price of Good 2
X1 - quantity of Good 1
X2 - quantity of Good 2
M - income of the consumer

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2014-2015 (March) Delhi Set 1

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