If the price of the good measured along the vertical axis increases without a change in the price of the good measured along the horizontal axis,a consumer's budget constraint ________.
A) pivots rightward without a change in the intercept on the horizontal axis
B) pivots leftward without a change in the intercept on the horizontal axis
C) shifts to the right
D) shifts to the left

Question

Quizplus · Accepted Answer

When the price of the good on the vertical axis increases, the slope of the budget constraint becomes steeper, indicating that the consumer can afford less of that good for any given amount of the good on the horizontal axis. This is represented by a leftward pivot of the budget constraint line, without changing the intercept on the horizontal axis, which represents the quantity of the other good that can be purchased if the consumer spends all their income on it.

If the Price of the Good Measured Along the Vertical