What would happen to the budget line if the price of orange juice increased and orange juice is measured on the vertical axis?
A)It would shift to the right.
B)It would rotate outward along the horizontal axis.
C)It would rotate inward along the horizontal axis.
D)It would rotate outward along the vertical axis.
E)It would rotate inward along the vertical axis.

Question

Quizplus · Accepted Answer

If the price of orange juice increases, the budget constraint will rotate inward along the vertical axis since the consumer has to give up more units of other goods to purchase the same amount of orange juice as before.

What Would Happen to the Budget Line If the Price