Consider a Budget Line Drawn with Apples on the Vertical

question 13

Multiple Choice

Consider a budget line drawn with apples on the vertical axis and oranges on the horizontal axis.The consumer's income is $100,the price of apples is $5,and the price of oranges is $10.Suppose the consumer's income falls to $75.00,but the prices of apples and oranges remain unchanged.The change in income produces a:

• A)parallel shift inward of the indifference curves.
• B)new budget line which is steeper than the original one.
• C)parallel shift inward of the budget line.
• D)new budget line which is flatter than the original one.

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Definitions:

Foreign Exchange

The global market for trading currencies, enabling the conversion of one currency into another.

U.S. Dollar

The currency unit of the United States, widely used globally in international trade and as a reserve currency.

Foreign Exchange

The exchange of one currency for another or the global market where currencies are traded.

Exchange Rate

The value of one currency for the purpose of conversion to another currency.