Budget line

Summary

Budget

• Budget constraint: The equation $p_1x_1+p_2x_2≤m$
• The equation of the budget line: The equation $p_1x_1+p_2x_2=m$
• Budget line: The set of all bundles satisfying $p_1x_1+p_2x_2=m$

• The budget line is a straight line sloping downwards .
• Budget set: The set of all bundles that satisfy the budget constraint