What is a budget constraint?

A. It is the amount of utility that a consumer receives from spending a limited amount of income on goods and services.

B. It is the amount of income that yields equal marginal utility per dollar spent.

C. It is the amount of money necessary to purchase a given combination of goods.

D. It is the limited amount of income available to consumers to spend on goods and services.

Question

Peppa Pig

Business

8 September, 06:27

What is a budget constraint?

A. It is the amount of utility that a consumer receives from spending a limited amount of income on goods and services.

B. It is the amount of income that yields equal marginal utility per dollar spent.

C. It is the amount of money necessary to purchase a given combination of goods.

D. It is the limited amount of income available to consumers to spend on goods and services.

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Answers (1)

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Johnathon Herman · Answer 1

D. It is the limited amount of income available to consumers to spend on goods and services.

Explanation:

A budget constraint happens when a consumer is limited in the goods and services they consume by a certain income.