About This Lesson
Students explore budget constraints by solving a contextual problem involving the purchase of goods on a fixed income. Adjustments to the quantities of two goods are used to explore the meaning of points on a graph and relationships between quantities and disposable income. Students scale and label axes as they create graphs of relationships between two goods they want to purchase with a fixed income. Students create a representation of a budget constraint and predict the effects of changes in income and the prices of goods on the representation of the budget constraint.
