Figure 21-2
In each case, the budget constraint moves from BC 1 to BC 2 .
Graph (a)
Graph (b)
Graph (c)
Graph (d)
-Refer to Figure 21-2. Which of the graphs in the figure reflects an increase in the price of good X only?
A)Graph (b)
B)Graph (a)
C)Graph (c)
D)Graph (d)

Question

Figure 21-2
In each case, the budget constraint moves from BC 1 to BC 2 .
Graph (a)
Graph (b)
Graph (c)
Graph (d)    
-Refer to Figure 21-2. Which of the graphs in the figure reflects an increase in the price of good X only?
A)Graph (b) 
B)Graph (a) 
C)Graph (c) 
D)Graph (d)

Quizplus · Accepted Answer

Graph (a) shows a leftward shift of the demand curve for good Y, which can be interpreted as a decrease in the demand for good Y due to an increase in the price of good X (a substitute good), without showing any direct change in the market for good X itself.

Figure 21-2 in Each Case, the Budget Constraint Moves from BC1 to BC1

Figure 21-2 in Each Case, the Budget Constraint Moves from BC₁ to BC₁