The slope of the budget constraint is determined by the
A)relative price of the goods measured on the axes.
B)relative price of the goods measured on the axes and the consumer's income.
C)endowment of productive resources.
D)preferences of the consumer.

Question

Quizplus · Accepted Answer

The slope of the budget constraint depends only on the relative price of the goods measured on the axes. The consumer's income affects the position of the budget constraint, but not its slope. The endowment of productive resources and preferences of the consumer do not directly determine the slope of the budget constraint.

The Slope of the Budget Constraint Is Determined by the