The restriction that a consumer's total expenditure on goods and services purchased cannot exceed the income available is referred to as
A) maximising behaviour.
B) economising behaviour.
C) the price constraint.
D) the budget constraint.

Question

Quizplus · Accepted Answer

The given restriction is commonly known as the budget constraint. Therefore, option D is the correct answer. The other options, maximising behaviour and economising behaviour, may be related to consumer behaviour theory but they do not directly address the given restriction. Option C, the price constraint, is also related to consumer behaviour theory but it does not explicitly include the element of income available, which is fundamental to the budget constraint.

The Restriction That a Consumer's Total Expenditure on Goods and Services