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Question
With reference to the diagram shown above, select the reason for the movement from point M to N from the following options.
Options
Increase in the real income of the consumer and rise in relative price of the commodity.
Increase in the real income of the consumer and fall in relative price of the commodity.
Decrease in the real income of the consumer and rise in relative price of the commodity.
Decrease in the real income of the consumer and fall in relative price of the commodity.
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Solution
Increase in the real income of the consumer and fall in relative price of the commodity.
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