Match List-I with List-II

List-I	List-II
(A) Parallel inward shift in budget line	(I) M/p₁ > M/p₁'
(B) Parallel outward shift in budget line	(II) M/p₁ < M/p₁'
(C) Budget line steeper	(III) M' < M
(D) Budget line flatter	(IV) M' > M

Choose the correct answer from the options given below:

Option 1 -> Incorrect matching of budget line shifts with their conditions.

Option 2 -> Incorrect matching of budget line shifts with their conditions.

Option 3 -> Incorrect matching of budget line shifts with their conditions.

Option 4 -> (A)-(III): Parallel inward shift occurs when income decreases (M' < M); (B)-(IV): Parallel outward shift occurs when income increases (M' > M); (C)-(I): Budget line becomes steeper when p₁ increases, making M/p₁ > M/p₁'; (D)-(II): Budget line becomes flatter when p₁ decreases, making M/p₁ < M/p₁'.

Hence, Option 4: (A) - (III), (B) - (IV), (C) - (I), (D) - (II) -> A parallel shift (inward or outward) occurs when income changes while prices remain constant. (A) Inward shift means lower income (M' < M), matching (III). (B) Outward shift means higher income (M' > M), matching (IV). For rotational changes: (C) A steeper budget line means the slope -p₁/p₂ increases in absolute value, occurring when p₁ rises. This reduces the x₁-intercept, so M/p₁ > M/p₁', matching (I). (D) A flatter budget line means p₁ falls, increasing the x₁-intercept, so M/p₁ < M/p₁', matching (II) -> correct