An increase in income (all else equal) will ALWAYS lead to a parallel shift of the budget line
Indicate whether the statement is true or false
True . Since prices are unchanged, the relative prices of the goods stay the same, and thus the slope of the budget line remains the same.
You might also like to view...
Suppose a chemical plant regularly dumps chemicals into a river that must be cleaned up before farmers located downstream can use the water on their crops
Dumping the chemicals into the river saves the chemical plant $750,000 in yearly disposal costs and cleaning the water costs farmers $825,000 each year. Explain what the benevolent social planner would like to see happen in this case.
The above table shows a firm's
A) long-run costs. B) short-run costs. C) short-run and long-run costs. D) More information is needed to determine if the costs are long-run costs or short-run costs.