The budget set defines the combinations of good X and Y that
A)are desirable to the consumer.
B)are affordable to the consumer.
C)maximizes consumer's utility.
D)maximizes supplier's profit.

Question

Quizplus · Accepted Answer

The budget set only defines the combinations of goods X and Y that are affordable to the consumer. It does not necessarily indicate which combinations are desirable or optimal in terms of maximizing utility or profit.

The Budget Set Defines the Combinations of Good X and Y