Assume There Is a Budget Line with Bagels on the Vertical

question 330

Multiple Choice

Assume there is a budget line with bagels on the vertical axis and bananas on the horizontal axis. What happens to the budget line when the price of bagels rises by 10% and the price of bananas rises by 20%?

• A) There is a parallel outward shift of the budget line.
• B) There is a parallel inward shift of the budget line.
• C) The budget line changes to have a steeper slope.
• D) The budget line changes to have a flatter slope.

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Definitions:

Crowdfunding

A cooperative activity in which people network and pool funds and other resources via the Internet to assist a cause (such as disaster relief) or invest in a business venture (such as a startup).

Raise Capital

The process of generating funds or resources for a business or project, typically through investments, loans, or selling equity.

Public

Pertains to the community as a whole or the people of a society.

Private Equity Capital

Capital funds invested by a private equity firm in an existing corporation, usually to purchase and reorganize it.