A student has a monthly budget of 120 to spend on either...

A student has a monthly budget of $120 to spend on either burritos, which cost $6 each, or sodas, which cost $4 each. 7. What is the opportunity cost of a burrito? 8. What is the opportunity cost of a soda? 9. The local farmer's market offers 1 bag of cilantro for $6 or 2 bags for $10. What's the marginal cost of the second bag?

KEY QUESTION Suppose you won \$15 on a lotto ticket at the local 7 -Fleven and decided to spend all the winnings on candy bars and bags of peanuts. The price of candy bars is S.75 and the price of peanuts is $\$ 1.50 .$ LO4 a. Construct a table showing the alternative combinations of the two products that are available. b. Plot the data in your table as a budget line in a graph. What is the slope of the budget line? What is the opportunity cost of one more candy bar? Of one more bag of peanuts? Do these opportunity costs rise, fall, or remain constant as cach additional unit of the product is purchased? c. How, in general, would you decide which of the available combinations of candy bars and bags of peanuts to buy? d. Suppose that you had won $\$ 30$ on your ticket, not $\$ 15$ Show the S30 budget line in your diagram. Why would this budget line be preferable to the old one?

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