At the consumer's optimum the
A) budget constraint will have a slope of MUx/Px.
B) slope of the indifference curve is equal to the slope of the budget constraint.
C) indifference curve will intersect the budget constraint at the midpoint of the budget constraint.
D) Both b and c are correct.

Question

Quizplus · Accepted Answer

At the consumer's optimum, the slope of the indifference curve (which represents the rate at which a consumer is willing to trade one good for another) is equal to the slope of the budget constraint (which represents the rate at which the market allows the consumer to trade one good for another).

At the Consumer's Optimum the