illustrate and explain what happens to the budget line when the consumer's income doubles to $200 other things constant
Answers
If the income of the consumer double from ₹200 to ₹400 ,he is capable to buy more bundles of 2 goods at constant prices. This will result in the rightward shift of the budget line.
Answer:
When the income of a person doubles to 200$, they can afford twice as much stuff they was able to afford for 100$. There we are bound to see the budget line shift towards right.
Explanation:
A budget line is an indication of the shift that takes place when either the income of the consumer or the price of the goods change. In this scenario the price of the goods is constant.
What changes is the income of the consumer which is doubled. In any normal budget line, we see that when the income of the consumer is doubled, tripled or quadrupled, the budget lines shift relatively towards the right while being parallel to its previous, original position.