Use the following to answer question: -(Figure: The Optimal Consumption Bundle)Use Figure The Optimal Consumption Bundle.Which of the following could lead to an optimal consumption bundle on indifference curve I₃? A)a decrease in income B)a decrease in the price of restaurant meals C)an increase in the price of rooms D)an increase in the price of restaurant meals

Question

Quizplus · Accepted Answer

A decrease in the price of restaurant meals would result in a lower marginal rate of substitution between meals and rooms, shifting the optimal consumption bundle to the right along indifference curve I₃. The other answer choices would lead to a shift away from this indifference curve.

Use the Following to Answer Question