To Simplify Our Consumption Models,suppose U

question 131

Multiple Choice

To simplify our consumption models,suppose U.S.consumers only purchase food and all other goods where food is plotted along the horizontal axis of the indifference map.If the U.S.Congress passes an economic stimulus package that pays $300 to each person,how does this affect the budget line for each consumer?

• A)Makes the budget line steeper
• B)Makes the budget line flatter
• C)Parallel rightward shift
• D)Parallel leftward shift
• E)none of the above

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Definitions:

Classified Balance Sheet

A financial statement that groups a company's assets, liabilities, and equity into categories, making it easier to assess financial health.

Retained Earnings

Accumulated net income that a company decides to keep rather than distribute to its shareholders as dividends.

Owners' Equity

Owners' equity represents the ownership interest of the shareholders or owners in the net assets of a company, reflecting the difference between assets and liabilities.

Current Liability

A financial obligation that is due within one year or within the normal operating cycle of the business.