If the consumer's income and all prices simultaneously decrease by one-half, then the optimum consumption will
A)shift outward relative to the original optimum.
B)move leftward along the original budget constraint.
C)shift inward relative to the original optimum.
D)not change.

Question

Quizplus · Accepted Answer

The consumer's budget constraint remains unchanged because both income and prices decrease proportionally, maintaining the same relative affordability of goods.

If the Consumer's Income and All Prices Simultaneously Decrease by One-Half