Darla has an annual income of $120 that she spends on movies, at $10 per show, and All Other Goods. Suppose a movie theatre offers to sell her a pass that will allow her to see any amount of movies for $6 per show. The pass costs $30.

1. On the same graph, sketch Darla’s budget line if 1) she pays $10 per ticket, and 2) if she buys the pass for $30, and then pays $6 per ticket.
2. Will Darla buy the pass? Discuss, using graphs to illustrate your answer.

Answer rating: 100% (QA)

To analyze whether Darla will buy the movie pass or not lets plot Darlas budget line for both scenarios on a graph Scenario 1 Paying 10 per ticket In ... View the full answer