Goods X and Y

question 4

Multiple Choice

Goods X and Y

For the following questions, assume that good X is on the horizontal axis and good Y is on the vertical axis in the consumer-choice diagram. PX denotes the price of good X, PY is the price of good Y, and I is the consumer's income. Unless otherwise stated, the consumer's preferences are assumed to satisfy the standard assumptions.

-Refer to Goods X and Y.When the price of good X rises,what happens to the budget line?

• A) The budget line shifts in,with no change in the slope.
• B) The budget line becomes flatter,and the horizontal intercept moves to the right.
• C) The budget line becomes steeper,with no change in the vertical intercept.
• D) The budget line pivots about the horizontal intercept,with the vertical intercept moving up.

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Definitions:

Good-Faith Purchaser

An individual who buys property without knowledge of any existing claims or defects against it, thereby gaining legal protection.

Goods-In-Bailment Contract

An agreement involving the temporary transfer of personal property to another party for a specific purpose.

Nonnegotiable

Something that cannot be bought, sold, or transferred to another party, or a term or condition that is not open to discussion or modification.

Document of Title

A legal document proving a person's rights to the property or goods listed on it.