00:01
An individual sets aside a certain amount of his income per month to spend on his two hobbies, collecting wine and collecting books.
00:08
Given the information below, illustrate both the price consumption curve associated with changes in the price of wine and demand curve for wine.
00:18
Let's talk about what the price consumption curve shows.
00:50
This shows how consumption choices change when the price of one good changes.
01:01
So basically, when we draw this curve, we're going to have wine on one axis, and we're going to have books.
01:07
On the other.
01:22
So in this question, we're shown two columns, price of wine and price of book.
01:36
But for the price consumption curve, we're going to be looking at the quantity of these two.
01:41
So we have quantity of books, quantity of wine.
02:15
So basically, we're going to be graphing these onto the price consumption curve.
03:03
So here we have the first point.
03:07
There are eight books, versus seven wines, so the point ends up being here.
03:15
Then let's move on to the next one.
03:17
We have nine books versus five wines...