A consumer's optimum is found when
A) prices of goods go down.
B) the consumer is achieving the maximum level of utility given market prices and their limited income.
C) the marginal utility of the last dollar spent equals 0 for every good.
D) the consumer saves part of their income.

Question

Quizplus · Accepted Answer

The consumer's optimum is the point where they are able to achieve the highest level of satisfaction (utility) given the limitation of their income and the prices of goods in the market. This point is reached where the marginal utility per dollar spent is equal across all goods available in the market. Therefore, option B is the correct answer, as it describes this situation.

A Consumer's Optimum Is Found When