based on the graph above, assume that good a cost $20 while good b cost $10. what is the total budget for…

Explanation:

Step1: Identify intercept values

The budget - constraint line intersects the good A - axis at 10 units and good B - axis at 20 units.

Step2: Use the budget - equation formula

The budget equation is $P_AQ_A + P_BQ_B=Budget$, where $P_A$ is the price of good A, $Q_A$ is the quantity of good A, $P_B$ is the price of good B, and $Q_B$ is the quantity of good B. When $Q_B = 0$, $Q_A=\frac{Budget}{P_A}$; when $Q_A = 0$, $Q_B=\frac{Budget}{P_B}$. We know that $P_A = 20$ and $P_B=10$. Using the intercept on the good A - axis ($Q_A = 10$ when $Q_B = 0$), we can calculate the budget as $Budget=P_A\times Q_A$.

Step3: Calculate the budget

Substitute $P_A = 20$ and $Q_A = 10$ into the budget equation. $Budget=20\times10=200$. We can also use the intercept on the good B - axis ($Q_B = 20$ when $Q_A = 0$). Substituting $P_B = 10$ and $Q_B = 20$ into the budget equation $Budget = P_B\times Q_B$, we get $Budget=10\times20 = 200$.

Answer:

200