affordable given consumer income. Consider José's situation, shown in Figure 6.2. José likes to collect T-shirts

and watch movies.

In Figure 6.2 we show the quantity of T-shirts on the horizontal axis while we show the quantity of movies on

the vertical axis. If José had unlimited income or goods were free, then he could consume without limit.

However, José, like all of us, faces a budget constraint. José has a total of $56 to spend. The price of T-shirts is

$14 and the price of movies is $7. Notice that the vertical intercept of the budget constraint line is at eight

movies and zero T-shirts ($56/$7=8). The horizontal intercept of the budget constraint is four, where José

spends of all of his money on T-shirts and no movies ($56/14=4). The slope of the budget constraint line is rise/

run or –8/4=–2. The specific choices along the budget constraint line show the combinations of affordable T-

shirts and movies.
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