Answer to Question #197399 in Microeconomics for Vishvendra

Question

How the budget line shift due to price changeof good Y when the price of good X remain the same

Answer 1

Incase of an increase in the price of good Y, the amount of Y consumed would decrease where as more of good X would be consumed; if the price of good Y decreases, more of good Y will be consumed while less of good X will be consumed. The consumer will maximize utility (enjoyment) to the extent that the budget constraint would allow.