What could have caused a change in the budget line from B4 to B1? (a) an increase in the consumer's budget (b) an increase in the price of X (c) a decrease in the prices of both goods (d) both (a) and (b) are correct (e) both (a) and (c) are correct 400350300Y250 B4200B1150B3100500B20 1 2 3 4 5 6 7 8

Correct AnswerThe shift from budget line B4 to B1 indicates a change in the consumer's budget…

Answered: 400 350 300 Y 250 B4 200 B1 150 B3 100…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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		(a) an increase in the consumer's budget
		(b) an increase in the price of X
		(c) a decrease in the prices of both goods
		(d) both (a) and (b) are correct
		(e) both (a) and (c) are correct

400 350 300 Y 250 B4 200 B1 150 B3 100 50 0 B2 0 1 2 3 4 5 6 7 8