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For Sue, driving her car and taking the bus to work are prefect substitutes. Sue has...

For Sue, driving her car and taking the bus to work are prefect substitutes. Sue has $100 per month to spend on transportation to work, and driving costs $5 per day, while the bus is $4 per day. Find Sue's best affordable bundle of bus and car, the MRS of her utility function and the slope of her budget line, assuming Bus is on the vertical axis.

A 20 car; MRS =1; budget line slope= -4/5

B 25 bus ; MRS = -1; Budget line slope =-5/4

C 25 bus; MRS = -1; Budget line slope =-4/5

D 20 car; MRS =1; Budget line slope= 4/5

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Answer #1

Let us ustume the following (-) ar Pua kest of trag ur B = Bus. Po - Cest of taxing bal for Sue doning car and turtaning bus

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