Question

[
(19) the consumer is in equilibrium at a point where the budget line -
(a) is above an indifference curve
(b) is below an indifference curve
(c) is tangent to an indifference curve (d) cuts an indifference curve.​

Answer 1

Answer:

is tangent to an indifference curve

Explanation:

The consumer is in equilibrium at a point where the budget line is tangent to an indifference curve. It means that marginal substitution rate between X and Y (MRSXY) should be diminishing.

Answer 2

Answer:

The consumer is in equilibrium at a point where the budget line is tangent to an indifference curve, because it can not intersect the IC either from above or below