If both prices decreases by 50%,
A) budget constraint will be unchanged.
B) slope of the budget constraint will increase.
C) slope of the budget constraint will decrease.
D) budget constraint will shift outward in a parallel fashion.

Question

Quizplus · Accepted Answer

When both prices decrease by 50%, the consumer can afford more of both goods, causing the budget constraint to shift outward in a parallel manner.

If Both Prices Decreases by 50