Using indifference curve analysis, you can identify the point at which a consumer maximizes utility where the slope of the:
A) indifference curve is -1.
B) budget line is -1.
C) indifference curve is equal to the slope of the budget constraint.
D) indifference curve is greater than the slope of the budget constraint.

Question

Quizplus · Accepted Answer

A consumer maximizes utility at the point where the slope of the indifference curve is equal to the slope of the budget constraint, indicating that the marginal rate of substitution equals the price ratio.

Using Indifference Curve Analysis, You Can Identify the Point at Which