Consider a consumer with a choice set that emerges from an exogenous income I.Suppose that, as a result of changes in a consumer's economic circumstances, the budget line rotates outward, with the vertical intercept remaining unchanged but the horizontal intercept shifting to the right.Demonstrate, using the budget line equation, how this could have happened if the price of the good on the horizontal axis did not change?

Question

Quizplus · Accepted Answer

The Answer of Consider a consumer with a choice set that emerges from an exogenous income I.Suppose that, as a result of changes in a consumer's economic circumstances, the budget line rotates outward, with the vertical intercept remaining unchanged but the horizontal intercept shifting to the right.Demonstrate, using the budget line equation, how this could have happened if the price of the good on the horizontal axis did not change?

Consider a Consumer with a Choice Set That Emerges from an Exogenous