A decrease in a consumer's income
A)increases the slope of the consumer's budget constraint.
B)has no effect on the consumer's budget constraint.
C)decreases the slope of the consumer's budget constraint.
D)has no effect on the slope of the consumer's budget constraint.

Question

Quizplus · Accepted Answer

A decrease in a consumer's income shifts the budget constraint inward but does not affect its slope, which is determined by the relative prices of the goods.

A Decrease in a Consumer's Income