An outward,parallel shift in the budget line indicates that
A)The consumer's income has risen.
B) the consumer's demand for the good on the horizontal axis has risen.
C) the price of the good on the horizontal axis has fallen.
D) all commodity prices have simultaneously risen.

Question

An outward,parallel shift in the budget line indicates that 
A)The consumer's income has risen.
B) the consumer's demand for the good on the horizontal axis has risen.
C) the price of the good on the horizontal axis has fallen.
D) all commodity prices have simultaneously risen.

Quizplus · Accepted Answer

An outward, parallel shift in the budget line indicates that the consumer's income has risen. This means that the consumer can now afford more of both goods or the same amount of goods at a higher price level.

An Outward,parallel Shift in the Budget Line Indicates That