In 2012, the Associated Press Examined the Effect Higher Gas

question 280

Multiple Choice

In 2012, the Associated Press examined the effect higher gas prices on consumption of other goods. It said that the increase in the price of gasoline has decreased the quantity of other goods, such as food, that people consume. (Source: Associated Press, September 28, 2012)
-If consumers spend their income either on gasoline or food, then an increase in the price of gasoline rotates the budget line

• A) inward along the "food" axis.
• B) outward along the "food" axis.
• C) inward along the "gasoline" axis.
• D) outward along the "gasoline" axis.