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The Tangency of an Indifference Curve and a Budget Line

Question 8

Multiple Choice

The tangency of an indifference curve and a budget line:


A) gives the profit maximizing combination of two goods
B) gives the cost minimizing combination of two goods
C) can be determined without regard to the prices of the two goods
D) is found where the slope of the indifference curve (MRS) is equal to the price ratio

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