2. Suppose we have a 2- good economy; clothing and food. Food is graphed on the Y axis and clothing is graphed on the X axis. a. If prices and income double, what will happen to the budget line? b. Express the slope of the budget line in terms of the prices of the 2 goods (PC and PF) c. What happens to the budget line if a tax of 10% is placed on the purchase of clothing? d. What is the slope of the budget line after the introduction of the tax?

Xinhong company is considering replacing one of its manufacturing machines. the machine has a book value of $39,000 and a remaining useful life of 5 years, at which time its salvage value will be zero. it has a current market value of $49,000. variable manufacturing costs are $33,300 per year for this machine. information on two alternative replacement machines follows. alternative a alternative b cost $ 115,000 $ 117,000 variable manufacturing costs per year 22,900 10,100 1. calculate the total change in net income if alternative a and b is adopted. 2. should xinhong keep or replace its manufacturing machine