-The figure above shows Sam's budget line. Which of the following would result in Sam's budget line shifting leftward and not changing its slope?
A) a decline in his preferences for both gasoline and coffee
B) an equal percentage reduction in the prices of both a gallon of gasoline and a pound of coffee
C) a decrease in Sam's income
D) a fall in the ratio of the price of a gallon of gasoline to the price of a pound of coffee

Question

-The figure above shows Sam's budget line. Which of the following would result in Sam's budget line shifting leftward and not changing its slope?
A) a decline in his preferences for both gasoline and coffee 
B) an equal percentage reduction in the prices of both a gallon of gasoline and a pound of coffee 
C) a decrease in Sam's income 
D) a fall in the ratio of the price of a gallon of gasoline to the price of a pound of coffee

Quizplus · Accepted Answer

A decrease in Sam's income would shift the budget line leftward, as he can afford less of both goods, without changing the slope, which is determined by the price ratio of the two goods.

-The Figure Above Shows Sam's Budget Line