The Two-Period Budget Line for Incomes Y₁ and Y₂ and Consumption

question 1

Multiple Choice

The two-period budget line for incomes Y₁ and Y₂ and consumption C₁ and C₂ can be written as ,if the interest rate were to rise the budget line would

• A) shift to the left in a parallel fashion
• B) shift to the right in a parallel fashion
• C) rotate counter-clockwise pivoting on Y₁, Y₂
• D) rotate clockwise pivoting on Y₁, Y₂

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