Assume Joseph spends his entire income on X and Y,and his indifference curves have the usual convex shape.If Joseph maximizes his utility,then
A)he spends his entire available income.
B)there are other bundles that are preferred at the current price ratio.
C)the slope of his indifference curve is greater than the slope of his budget line.
D)the slope of his indifference curve is smaller than the slope of his budget line.

Question

Quizplus · Accepted Answer

When Joseph maximizes his utility given his budget constraint, he will spend his entire available income on the combination of goods X and Y that provides him the highest level of satisfaction. This is a fundamental principle of consumer behavior in microeconomics, where individuals allocate their limited resources in a way that maximizes their utility, leading to the consumption of all available income on the optimal bundle of goods.

Assume Joseph Spends His Entire Income on X and Y,and