When the price of a good decreases, the slope of the budget line changes but the intercept associated with that good remains the same.

Question

Quizplus · Accepted Answer

When the price of a good decreases, the intercept associated with that good on the budget line changes, indicating that a consumer can now purchase more of that good with the same budget, while the slope of the budget line, which represents the price ratio of the two goods, also changes.

When the Price of a Good Decreases, the Slope of the Budget