Which of the following is correct?
A)Budget lines are linear and upsloping; indifference curves are downsloping and concave to the origin.
B)Budget lines are linear and downsloping; indifference curves are downsloping and concave to the origin.
C)Budget lines are linear and downsloping; indifference curves are downsloping and convex to the origin.
D)Budget lines are downsloping and convex to the origin; indifference curves are linear and downsloping.

Question

Quizplus · Accepted Answer

Budget lines are linear and downsloping because they represent the trade-off between two goods given a fixed budget. Indifference curves are downsloping and convex to the origin, reflecting the consumer's preference for a balanced mix of goods.

Which of the Following Is Correct