1
Q
What is a budget constraint?
A
The limit on what a consumer can afford.
2
Q
What are indifference curves?
A
Curves showing combinations with equal utility.
3
Q
Why are indifference curves downward sloping?
A
Because consumers must give up one good to get more of another.
4
Q
What is the optimal consumption point?
A
Where the budget line is tangent to an indifference curve.
5
Q
A
