Budget Line

Question 1

What is budget line

Answer 1

It shows the combination of commodities that the consumer can afford, given the consumers income and the prices of goods
Here the income and price is known
(It is the graphical representation of the budget constraint which defines the boundary of consumers expenditure)

Question 2

The budget line equation

Answer 2

B=PxX +PyY
X is qty of x
Px is price of x 
B=PxX +PyY
PyY=B-PxX
Y=(B-PxX)/Py
While for X
PxX=B-PyY
X=(B-PyY)/Px

Question 3

Extra note

Answer 3

The consumer can buy any combination of the two products along the line provided he is spending the whole budget
A budget line can be viewed as the boundary to the consumers opportunities for acquiring x and y

Question 4

Slope of a budget line

Answer 4

Slope=qty of y/qty of x
=oy/ox
=(B/Py)/(B/px)
=Px/Py