A consumer's budget constraint is:
A) a positively-sloped line.
B) a negatively-sloped line.
C) convex.
D) a vertical line at the level of the consumer's income.

Question

Quizplus · Accepted Answer

A consumer's budget constraint is a negatively-sloped line because it represents the trade-off between the consumption of two goods given the consumer's income and the prices of the goods. As the consumer spends more on one good, they have less to spend on the other, leading to a downward slope.

A Consumer's Budget Constraint Is