The idea that a consumer is limited to selecting a bundle of goods that is affordable is captured by the:
A) budget constraint.
B) indifference curve.
C) consumer equilibrium.
D) price changes.

Question

Quizplus · Accepted Answer

The budget constraint represents the limit of what a consumer can afford and is determined by the consumer's income and the prices of goods. It shows the different combinations of goods that a consumer can choose from given their budget limitations. Therefore, the idea that a consumer is limited to selecting a bundle of goods that is affordable is captured by the budget constraint.

The Idea That a Consumer Is Limited to Selecting a Bundle