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Grade 9-12
,
Lesson

Graphing and Interpreting Linear Relationships in the Context of Budgeting

Time: 60 mins,
Updated: March 24 2021,
Author: Signe Kastberg

Objective

Students will be able to:

  • Create a graph representing a budget line and calculate the trade-offs of moving along the line.
  • Represent a budget line using an equation in two variables.
  • Predict transformations of the budget line given changes in income, changes in price of a good, or both.
  • Calculate an equation for a budget line.
  • Explain the meaning of the budget line in terms of personal finance.

Assessment

  1. Bill has $10 dollars to spend on chips and soda. If the price of chips is $1 and the price of a soda is $2, which equation represents the relationship between Bill’s income and the quantity of chips (x) and soda (y) he can purchase with his money?
    1. 10 = 2x + 1y
    2. [10 = 1x + 2y]
    3. 10 = x + y
    4. 10 = ½ x + y
  2. Bill has $10 dollars to spend on chips and soda.  If the price of chips is $1 and the price of a soda is $2, which graph represents the relationship between Bill’s income and the quantity of chips (x) and soda (y) he can purchase with his money?

a. 

b. 

c. 

d. 

[Answer: a.]

  1. Create a graph of the budget constraint line if Pat’s income is 12 dollars, bus tokens are four dollars, and fries are two dollars.

Answer: