If the Price of Good X Increases,what Will Happen to the Budget

question 90

Multiple Choice

If the price of good X increases,what will happen to the budget line?

• A) It will have a parallel shift inward.
• B) It will have a parallel shift outward.
• C) It will become steeper.
• D) It will become flatter.

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Definitions:

Borrowing Rate

The interest rate that a lender charges a borrower for the loan of funds, varying based on credit risk, loan amount, and duration.

Net 60

A payment term indicating that payment is due 60 days after the invoice date.

Lock Box System

A banking service provided to companies for speeding up collection of payments by having those payments sent directly to a bank's PO box, rather than to the company.

Clearing Time

The period between the initiation of a transaction and its settlement, during which the transaction is processed and validated.