When does the Budget line shift ?

Change in income

The correct answer is option (1) : Change in income

The budget line represents the various combinations of goods and services that a consumer can afford given their income and the prices of goods. When there is a change in income (assuming prices remain constant), the budget line shifts outward or inward, reflecting an increase or decrease in purchasing power. This allows consumers to afford different combinations of goods and services compared to their previous budget constraint.