At equilibrium the slope of the indifference curve is:- a.) equal to the slope of budget line b.) greater than the slope of budget line c.) smaller than the slope of budget line d.) none
Answers
Answer:
At equilibrium the slope of the indifference curve is - a.) equal to the slope of budget line.
Your answer is option (a).
《 Mark me as brainliest..!》
Answer:
At equilibrium the slope of the indifference curve is equal to the slope of budget line.
So, option a is the correct answer.
Explanation:
An indifference curve is a graph that shows the combination of two goods that give the consumer equal utility and satisfaction. Each point on the indifference curve indicates that the consumer is indifferent between the two, and all points give him the same utility.
People seek the highest utility, which means they want to be as high on the indifference curve as possible. However, people are constrained by their budget constraints, which show what compromises are actually possible. The solution to this problem, that is, the combination of goods and services that maximizes the individual's total utility given his budget, is called the consumer's equilibrium. A consumer is in equilibrium when he maximizes his utility given his income and market prices.
A budget line is a graphical representation of the various combinations of two goods that a consumer can afford at specified prices for the goods at a given income level. A budget line can be created based on a cost plan.
Consumer equilibrium exists at the point on the indifference curve where the budget line is tangent to the curve. Thus, at the equilibrium point, the slope of the budget line is equal to the slope of the indifference curve.
Slope word related two more questions:
https://brainly.in/question/52249026
https://brainly.in/question/30561465
#SPJ3