Graph 22-5

-Refer to Graph 22-5. In the figure shown, an optimising consumer is most likely to select the consumption bundle associated with:

Question

Graph 22-5
 
-Refer to Graph 22-5. In the figure shown, an optimising consumer is most likely to select the consumption bundle associated with:

Quizplus · Accepted Answer

Point C represents the point where the budget constraint is tangent to the highest possible indifference curve. At this point, the consumer is maximizing their utility given their budget constraint. Therefore, the optimising consumer is most likely to select the consumption bundle associated with point C. Points A and B represent bundles that are feasible, but do not provide the maximum level of utility given the budget constraint. Point E represents a bundle that is not feasible given the budget constraint.

Graph 22-5 -Refer to Graph 22-5. in the Figure Shown, an Optimising