The U. government has a food stamp program for families whose income falls below a certain poverty threshold. Food stamps have a dollar value that...
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The U.S. government has a food stamp program for families whose income falls below a certain poverty threshold. Food stamps have a dollar value that can be used at supermarkets for food purchases as if the stamps were cash, but the food stamps cannot be used for anything other than food. Suppose the program provides $500 of food stamps per month to a particular family that has a fixed income of $1,000 per month.

With "dollars spent on food" on the horizontal axis and "dollars spent on non-food items" on the vertical, illustrate this family's monthly budget constraint. How does the opportunity cost of food change along the budget constraint you have drawn?

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