When considering her budget,the highest indifference curve that a consumer can reach is the
A)one that is tangent to the budget constraint.
B)indifference curve farthest from the origin
C)indifference curve that intersects the budget constraint in at least two places.
D)None of the above is correct; consumer preferences are bounded.

Question

Quizplus · Accepted Answer

The highest indifference curve that a consumer can reach is the one that is tangent to the budget constraint. This is because at this point, the consumer is maximizing their utility given their budget constraint, and any point beyond this tangent point would require a higher budget constraint.

When Considering Her Budget,the Highest Indifference Curve That a Consumer