A consumer\'s budget constraint changes slope whenever: the consumer buys a diff

Question

A consumer's budget constraint changes slope whenever: the consumer buys a different combination of goods relative prices change an indifference curve is tangent to it the consumer's income increases absolute prices change The marginal rate of substitution: remains constant as the consumer moves around an indifference curve is constant if the goods are perfect complements decreases as the consumer moves down a typical indifference curve cannot be defined if the goods are perfect substitutes none of the above

Explanation / Answer

9. Option B is correct.

Slope of the budget line is the ratio of prices of the two goods.

10. Option C is correct.

MRS = MU of X/MU of Y

Moving down along an indifference curve, MU of X would fall and the MU of Y would increase, hence the MRS would fall.

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