Author Question: Consider a household's budget line. An equal and proportional increase in money income and all money ... (Read 69 times)

Dannyrod2 · **on:** Oct 12, 2022

Question 1

Consider a household's budget line. If money income is reduced by half, and the prices of all goods consumed by the household are reduced by half, the budget line will
◦ not change.
◦ shift outward.
◦ become steeper.
◦ shift inward.
◦ become flatter.

Question 2

Consider a household's budget line. An equal and proportional increase in money income and all money prices will
◦ shift the budget line to the left parallel to the original budget line.
◦ leave the position of the budget line unchanged.
◦ rotate the budget line inward from the horizontal axis.
◦ shift the budget line to the right parallel to the original budget line.
◦ rotate the budget line inward from the vertical axis.

KeriJennin · **Reply #1 on:** Oct 12, 2022

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