Final answer:
An increase in the price of one product but not the other changes the slope of the budget line by causing the budget constraint to rotate inward from the axis of the good that has not changed in price. This reflects a decrease in the quantity of the now more expensive good that can be bought with the same budget. Option A is the correct answer.
Step-by-step explanation:
An increase in the price of one product but not the other affects the consumer's budget constraint in terms of the quantity of goods they can purchase.
Specifically, this change alters the slope of the budget line because it changes the rate at which one can trade off one good for another without altering overall spending.
When the price of one good, say good on the horizontal axis, increases, it becomes more expensive relative to the other good, which remains unchanged in price.
This causes the budget constraint to rotate inward from the axis where the price remained constant, effectively changing the slope. This adjustment reflects the reduced number of units of the expensive good that can be bought.
Consider Sergei's choice between baseball bats and cameras, where a price rise in baseball bats changes his purchasing power only for bats and not cameras.
This reflects the real-world scenario where a price change in one item (baseball bats) will not affect the consumer's ability to purchase other items (cameras).
The budget line here would rotate inward from the vertical axis that represents cameras, indicating a decreased quantity of baseball bats that Sergei could afford given his budget.
To summarise, the correct option answer to the question is a) changes the slope of the budget line.
This represents how consumers would need to adjust their consumption choices and trade-offs between the two goods when faced with a price change in one while holding income constant.