The immediate effect on the budget line will be:

CA Foundation · Business Economics · MTP · May 2026
The immediate effect on the budget line will be:
(A) A. Parallel inward shift
(B) B. Outward rotation
(C) C. Inward rotation towards A-axis
(D) D. No change

Suggested Answer and Working Notes:

Correct Answer: Option (C)

C. Inward rotation towards A-axis

Topics: Theory of Demand and Supply

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