-In the figure above, suppose the original budget line is BD. A fall in the price of a compact disc will
A) result in a parallel leftward shift of the budget line.
B) not move the budget line.
C) rotate the budget line to CD.
D) rotate the budget line to AD.

Question

-In the figure above, suppose the original budget line is BD. A fall in the price of a compact disc will
A) result in a parallel leftward shift of the budget line. 
B) not move the budget line. 
C) rotate the budget line to CD. 
D) rotate the budget line to AD.

Quizplus · Accepted Answer

A fall in the price of a compact disc will allow the consumer to purchase more compact discs for the same amount of money, causing the budget line to rotate outward from the axis representing compact discs, moving from BD to CD.

-In the Figure Above, Suppose the Original Budget Line Is