When a consumer is at the consumer optimum

Question

Quizplus · Accepted Answer

At consumer optimum, the consumer has allocated their budget in a way that MUa/Pa = MUb/Pb = MUc/Pc = . . . = MUn/Pn, which means the consumer is getting the highest satisfaction per unit of money spent on each good. Therefore, option D is the correct choice. Option B is also partially correct but does not mention MU, therefore option D is a better answer. Options A and C are incorrect as they mention total utility, which is not relevant for consumer optimization.

When a Consumer Is at the Consumer Optimum