The Following Diagram Shows Two Budget Lines: a and B

question 193

Multiple Choice

The following diagram shows two budget lines: A and B.
Which of the following could explain the change in the budget line from A to B?

• A) a decrease in income and a decrease in the price of X
• B) a decrease in income and an increase in the price of X
• C) an increase in income and a decrease in the price of X
• D) an increase in income and an increase in the price of X

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Definitions:

Manufacturer Profit

The financial gain a manufacturing company secures from its operations after deducting costs associated with production and distribution.

Short Term

A period of time that is immediate or not far in the future, usually less than a year, often used in reference to planning or financial strategies.

Product Availability

the extent to which a product is obtainable in the desired quantities at the right time and place for customers.

Revenue

The total amount of income generated by the sale of goods or services related to a company's primary operations.