Budget Line Equation Calculator Instructions:
If you have two goods, x and y, each with a respective price, which follows the
budget line, you can use this calculator to determine
any one of the five budget line items with the equation below.
I = Qx x Px + Qy x Py
where I = Total Income of the Consumer
Px = Price of item x.
Qx = Quantity of item x
Py = Price of item y.
Qy = Quantity of item y
EXAMPLE: Lets say you want to figure out how much income you need to buy 2 shirts at 5
dollars each and 3 pants at 6 dollars each. You would press the Calculate
Income. Then you would enter 2 for quantity of x, 5 for price of x, 3 for
quantity of y, and 6 for price of y and Press Calculate. Your answer is 28. Related Formulas:
I = Qx x Px + Qy x Py Search Engine Shortcut Examples:
↑Back to Top of Lesson↑
Report a problem with this lesson
Tags: budget, price, quantity