Robert spends his income on lattes and all other goods. Lattes cost $4 each. If his income increases from $400 to $500 and the price of lattes increases to $5, which of the following are true? Assume that lattes are on the horizontal axis and all other goods are on the vertical axis. Choose one or more: A. The budget line gets flatter. B. Robert would be able to purchase the same quantities of lattes even after the price increased. DC. Robert's budget set will shrink. D. Robert's budget set will increase.

Robert spends his income on lattes and all other goods. Lattes cost $4 each. If his income increases from $400 to $500 and the price of lattes increases to $5, which of the following are true? Assume that lattes are on the horizontal axis and all other goods are on the vertical axis. Choose one or more: A. The budget line gets flatter. B. Robert would be able to purchase the same quantities of lattes even after the price increased. DC. Robert's budget set will shrink. D. Robert's budget set will increase.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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