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Assume French Fries are x1 and Beef Jerky are x2

Economics

Assume French Fries are x1 and Beef Jerky are x2.   If p1=2,  p2 =5, and m=100. What is the maximal consumption of French Fries?

 

  1. a.100
  2. b.20
  3. c.25
  4. d.50

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Suppose consumer consumes x1 and x2 and prices are p1 and p2 respectively. Budget constraint for income m is given by:

p1*x1 + p2*x2 <= m

Here,

p1 = 5, p2 =2, and m=100

Budget constraint is

5*1 + 2*2 <= 100

5*20 + 2*0 = 100

So, the maximal consumption of French Fries is 20. The correct option is B "20".