Figure: Consumer Equilibrium III
(Figure: Consumer Equilibrium III) Look at the figure Consumer Equilibrium III.Given the figure, which of the following is true?
A)Point C is preferable to point E
B)At point E, Px = Py
C)Point B could be attained if there was an increase in the consumer's budget.
D)To increase utility beyond that received at point E requires a change in the preferences of the consumer.

Question

Figure: Consumer Equilibrium III
(Figure: Consumer Equilibrium III) Look at the figure Consumer Equilibrium III.Given the figure, which of the following is true?
A)Point C is preferable to point E
B)At point E, Px = Py
C)Point B could be attained if there was an increase in the consumer's budget.
D)To increase utility beyond that received at point  E requires a change in the preferences of the consumer.

Quizplus · Accepted Answer

Point B could be attained if there was an increase in the consumer's budget, as it lies on a higher indifference curve, indicating higher utility, which can be achieved with a larger budget.