alleryStart learning →A budget constraint shows what a consumer can do?
AProduce at least cost
BSell at highest price
CAfford at given income
DEarn the highest wage
Answer & Solution
Correct answer: C. Afford at given income
It lists all combinations of goods that can be bought given current prices and a given level of income.
Keep practising Theory of Consumer Behaviour
Browse all Theory of Consumer Behaviour questions for CA Foundation, or explore more Business Economics topics.
Related questions
Which assumption makes curves smooth and convex to the origin?The law of demand holds even when the consumer is compensated for a price rise. This is thConsumer theory derives demand curves using budget lines and what?The indifference curve idea in biology models what?Reluctance to spend on luxuries beyond a set limit reflects what?An impulsive purchase is an example of what, per behavioural critics?Behavioural economists say consumers often use shortcuts called what?Traditionally, rational behaviour of a consumer means what?