Suppose it is possible to buy left shoes for a price of $35/shoe and right shoes for a price of $50/shoe. Alex has an annual budget of $850 for buying shoes, and she has, like most people two feet.
- Draw Alex's budget line between left shoes (on the horizontal axis) and right shoes (on the vertical axis). Draw a few of her indifference curves, and show her optimal choice. How many left shoes and how many right shoes does she buy?