The vertical axis measures money spent on other goods, so other goods (when measured in money spent) have Price = 1. Our consumer's budget will intercept the vertical axis at the amount of her income, IO. The price of videos is PV1, so for every video purchased our consumer has PV1 fewer dollars to spend on other goods.

    The slope of this constraint is simply -PV1 ÷ 1 = -PV1 (see the Budget Constraints section for review). Let's suppose she maximizes her utility by choosing point A where she buys V0 videos. What happens when the price of videos changes?

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