An increase in income shift a person's budget line rightward and does not change its slope.

Question

Quizplus · Accepted Answer

An increase in income leads to a higher budget constraint and moves the entire budget line rightward, without changing its slope. The slope of a budget line is determined by the relative prices of the goods and services being considered, and an increase in income does not affect the prices of these goods or services.

An Increase in Income Shift a Person's Budget Line Rightward