If Nick consumes only two goods, oranges and plums, and he increases his consumption of oranges, then
A) the price of oranges must have increased
B) Nick's income must have increased
C) plums and oranges must be complements
D) he must reduce his consumption of plums to remain on the same indifference curve
E) Nick's MU/P of oranges will now increase

Question

Quizplus · Accepted Answer

To remain on the same indifference curve while increasing consumption of one good, a consumer must reduce consumption of another good, assuming their income and the prices of goods remain constant. This is because an indifference curve represents a combination of two goods that give the consumer the same level of satisfaction.

If Nick Consumes Only Two Goods, Oranges and Plums, and He