Income increases cause an increase in a household's choice set.

Name: Income increases cause an increase in a household's choice set.
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Question

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When a household's income increases, they have more purchasing power and can afford a greater variety of goods and services. This expands their choice set, which refers to the range of options available for consumption or investment. Therefore, an increase in income tends to broaden a household's opportunities and alternatives.

Income Increases Cause an Increase in a Household's Choice Set