Author Question: If prices of both horizontal and vertical goods decrease by 50, A) budget constraint will be ... (Read 44 times)

Melani1276 · **on:** Jul 1, 2018

If prices of both horizontal and vertical goods decrease by 50,

A) budget constraint will be unchanged.
B) slope of the budget constraint will increase.
C) slope of the budget constraint will decrease.
D) budget constraint will shift outward in a parallel fashion.

Question 2

The above figure shows the market for a particular good. If the market is controlled by a perfect-price-discriminating monopoly, compared to a perfectly competitive market, the change in producer surplus is

A) B + C.
B) D + E.
C) A + B + C.
D) A + B + C + D + E.