Maria Has a Budget of $2,000 Per Year to Spend

question 257

Multiple Choice

Maria has a budget of $2,000 per year to spend on travel (assuming the price per trip is equal to $400) and clothes (assuming the price per outfit is equal to $100) . What happens to Maria's budget line if her budgeted income rises to $2,100?

• A) Her budget constraint will change its slope, indicating a greater ability to go on trips but a more limited ability to buy clothes.
• B) Her budget constraint will rotate outward from its intersection with the travel axis.
• C) Her budget constraint will rotate outward from its intersection with the clothing axis.
• D) The higher income will shift her curve outward with greater ability to buy both types of goods.

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Definitions:

Item Analysis

A series of statistical tests and procedures that can be used to assess for homogeneity in a test.

Construct Validity

The degree to which a test accurately measures the theoretical construct or concept it is intended to measure.

Content Validity

The ability of an instrument to fully assess or measure a construct of interest by sufficiently sampling from the entire universe of items for which the instrument was designed to sample.

Well-Established Construct

A concept or theory that has been extensively researched and validated, demonstrating consistent and reliable findings across studies.