A change in the quantity of goods available would NOT cause a rotation of the budget line.

Here's why:

1. A budget line represents the combination of goods a consumer can afford given their income and the prices of goods.

2. A change in the price of one good would cause a rotation of the budget line because it changes the relative cost of the goods. If the price of one good increases, the budget line will rotate inward, and if the price decreases, the budget line will rotate outward.

3. A change in the consumer's income would shift the budget line but not rotate it. If income increases, the budget line shifts outward, and if income decreases, the budget line shifts inward.

4. A change in the price of all goods would also shift the budget line but not rotate it. If all prices increase or decrease, the budget line shifts inward or outward respectively.

5. However, a change in the quantity of goods available does not affect the budget line. The budget line is determined by income and prices, not the quantity of goods. Therefore, a change in the quantity of goods available would not cause a rotation of the budget line.

Question

A change in the quantity of goods available would NOT cause a rotation of the budget line.

Here's why:

1. A budget line represents the combination of goods a consumer can afford given their income and the prices of goods.

2. A change in the price of one good would cause a rotation of the budget line because it changes the relative cost of the goods. If the price of one good increases, the budget line will rotate inward, and if the price decreases, the budget line will rotate outward.

3. A change in the consumer's income would shift the budget line but not rotate it. If income increases, the budget line shifts outward, and if income decreases, the budget line shifts inward.

4. A change in the price of all goods would also shift the budget line but not rotate it. If all prices increase or decrease, the budget line shifts inward or outward respectively.

5. However, a change in the quantity of goods available does not affect the budget line. The budget line is determined by income and prices, not the quantity of goods. Therefore, a change in the quantity of goods available would not cause a rotation of the budget line.

Knowee AI · Accepted Answer

A change in the quantity of goods available would NOT cause a rotation of the budget line.

Here's why:

1. A budget line represents the combination of goods a consumer can afford given their income and the prices of goods.

2. A change in the price of one good would cause a rotation of the budget line because it changes the relative cost of the goods. If the price of one good increases, the budget line will rotate inward, and if the price decreases, the budget line will rotate outward.

3. A change in the consumer's income would shift the budget line but not rotate it. If income increases, the budget line shifts outward, and if income decreases, the budget line shifts inward.

4. A change in the price of all goods would also shift the budget line but not rotate it. If all prices increase or decrease, the budget line shifts inward or outward respectively.

5. However, a change in the quantity of goods available does not affect the budget line. The budget line is determined by income and prices, not the quantity of goods. Therefore, a change in the quantity of goods available would not cause a rotation of the budget line.

Which of the following would NOT cause a rotation of the budget line? A change in the price of one good A change in the consumer's income A change in the price of all goods A change in the quantity of goods available

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