Read the following statements - Assertion (A) and Reasoning (R):
Assertion: If there is an increase in the income, the vertical as well as horizontal intercepts increase; there is a parallel outward shift of the budget line.
Reasoning: If the income increases, the consumer can buy more of the goods at the prevailing market prices.
From the given alternatives choose the correct one:

Both Assertion (A) and Reasoning (R) are true and Reasoning (R) is the correct explanation of Assertion (A).

Due to increase in income, the purchasing power of the individual rises. Now, he is able to purchase more of both the goods resulting in a parallel rightward shift in the budget line.