Economics 9708 · AS & A Level · Indifference curves and budget lines

Indifference curves and budget lines — practice question

The diagram contains two indifference curves and two budget lines for goods X and Y. The consumer’s starting position is at point F. The consumer’s preferred end position is point H. What does the shift from F to G indicate?

  • Athe income effect of a price fall for X
  • Bthe price effect of a price change for X
  • Cthe substitution effect of a price fall for X
  • Dthe substitution effect of a price rise for X

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