As the price of food changes, the budget line shifts out to the right.

Name: As the price of food changes, the budget line shifts out to the right.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

The budget line shifts due to changes in income or prices of goods. If only the price of food changes, the slope of the budget line changes, but it does not necessarily shift out to the right. A shift to the right would indicate an increase in income or purchasing power, not a change in the price of a specific good.

As the Price of Food Changes, the Budget Line Shifts