In indifference curve analysis, a point to the left of the consumer's budget line
A) implies that the household is not spending all of its income on the goods in question.
B) implies the household is paying below- market prices for the goods in question.
C) implies the household is paying above- market prices for the goods in question.
D) shows a combination of goods that are beyond the income of the household.
E) indicates consumption spending beyond current income.

Question

Quizplus · Accepted Answer

A point to the left of the budget line indicates a combination of goods that is not affordable for the household with their current income. This could mean they are not spending all of their income on the goods in question, as they cannot afford to do so.

In Indifference Curve Analysis, a Point to the Left of the Consumer's