What is budget constraint?
A) the set of consumption bundles that represent the amount the consumer cannot afford
B) the set of consumption bundles that represent the minimum amount the consumer can afford
C) the set of consumption bundles that represent the maximum amount the consumer can afford
D) the set of consumption bundles facing a consumer with an unlimited budget and no opportunity costs
E) the price at which an economic "good" becomes an economic "bad."

Question

Quizplus · Accepted Answer

Budget constraint is the set of consumption bundles that represent the maximum amount the consumer can afford, given their income and the prices of goods and services. This represents the limit on the amount of goods and services a consumer can buy with their limited income. Therefore, option C is the correct answer.

What Is Budget Constraint