Ans: d. the price of pizza rises to $20, the price of Pepsi rises to $4, and her income rises to $500.
Marge also buys pizza for $10 and Pepsi for $2. She has income of $200. Her budget constraint will experience a parallel outward shift if
a. the price of pizza falls to $8, the price of Pepsi falls to $1, and her income rises to $240.
b. the price of pizza falls to $5, the price of Pepsi falls to $1, and her income falls to $100.
c. the price of pizza rises to $20, the price of Pepsi rises to $4, and her income remains the same.
d. the price of pizza rises to $20, the price of Pepsi rises to $4, and her income rises to $500.
Economics
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