In indifference curve analysis, a line that shows all combinations of two goods a consumer can buy is called a(n):
A) indifference curve.
B) utility line.
C) budget line.
D) income possibility line

Question

Quizplus · Accepted Answer

An indifference curve represents all combinations of two goods that give a consumer a certain level of satisfaction or utility, while a utility line is not a term used in indifference curve analysis. The budget line, on the other hand, shows all combinations of two goods that a consumer can buy given the prices of the goods and the consumer's income. Therefore, choice C is correct as it describes the line that is shown in indifference curve analysis. Choice D is incorrect as it is not a term used in the analysis of indifference curves.

In Indifference Curve Analysis, a Line That Shows All Combinations