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Theory Of Consumer Behaviour
Question
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How does the budget line change if consumer income increases to र 40 but prices remain unchanged?

Answer

With increased income of र 40, the consumer can buy more of both the goods. So the budget line will shift rightwards parallel to original budget line.

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Some More Questions From Theory Of Consumer Behaviour Chapter

 Name two determinants of demand.

List the factors that cause changes in demand.

What is law of demand?

What is demand schedule?

Why does demand curve slope downwards?

Differentiate between substitute and complementary goods.

What is meant by one good being substitute of other?

What is meant by one good being complementary to another.

Give an example of a pair of commodities that are substitutes of each other.

Give an example of a pair of commodities such that one of them is complementary in consumption to the other.