If income doubles and the prices of all goods remain the same,the budget line will shift outward by 50 percent along each axis.

Name: If income doubles and the prices of all goods remain the same,the budget line will shift outward by 50 percent along each axis.
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Question

Quizplus · Accepted Answer

If income doubles and prices remain constant, the budget line will shift outward by 100 percent along each axis, not 50 percent, because the consumer can now afford twice as much of each good.

If Income Doubles and the Prices of All Goods Remain