Principles of Microeconomics / Unit 5 MIC 0409 short lesson, about 20 seconds
An Income Change Shifts the Budget Line
Captions available
The idea
Higher income shifts the budget line out, parallel, since prices and so the slope are unchanged. The new bundle usually holds more of both goods; less of one means that good is inferior.
In practice
Twice the income doubles both intercepts and leaves the slope alone.
Where people slip
A parallel shift is the signature of income; a change of slope is a price change, next video.
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