If the Prices of Both Goods and Income Increase by the Same

question 31

Multiple Choice

If the prices of both goods and income increase by the same percentage,what will happen to the budget line?

• A) The budget line rotates inward from the intercept on the axis of the good that did not change in price.
• B) The budget line rotates outward from the intercept on the axis of the good that did not change in price.
• C) The budget line shifts outward without a change in slope.
• D) Nothing.

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Definitions:

Abiotic Factors

Elements of the nonliving, physical environment that affect a particular organism. Compare with biotic factors.

Temperature

A measure of the average kinetic energy of the particles in a system, indicating how hot or cold the system is.

Latitude

Latitude refers to a geographic coordinate that specifies the north-south position of a point on the Earth's surface.

Biological Magnification

The process by which the concentration of toxic substances increases in organisms at each successive level of the food chain.