A budget constraint
A)does not occur if there is scarcity.
B)is faced only by poor people.
C)is a way to overcome scarcity.
D)forces people to make choices.
E)prohibits consumers from spending.

Question

Quizplus · Accepted Answer

A budget constraint is a limitation on the amount of goods and services that an individual can consume due to limited income. This limitation forces individuals to make choices about which goods and services they will purchase, which is essential in a world with scarcity. Therefore, choice D is the correct answer. The other options are not accurate - A is incorrect because scarcity always exists, B is incorrect because budget constraints are relevant to all income levels, C is incorrect because budget constraints do not overcome scarcity but rather reflect it, and E is incorrect because budget constraints do not prohibit spending but rather establish limits for spending.

A Budget Constraint