if-the-price-of-good-h-increases-how-does-this-affect-the-consumers-budget-const

Question

If the price of good H increases, how does this affect the consumer's budget constraint and optimum consumption?

Accepted Answer

The budget constraint pivots inward, reducing the consumer's ability to reach higher indifference curves.

Answer

The budget constraint shifts outward, allowing the consumer to reach a higher indifference curve.

Answer

The budget constraint becomes steeper, indicating a preference for another good.

Answer

The budget constraint remains unchanged, but the consumer can choose different combinations of goods.