Read the two statements and choose the correct option.
I. Every bundle on the budget line costs the same amount.
II. Every bundle on the budget line gives the same satisfaction.

Only ICorrect answerYour answerOnly IICorrect answerYour answerBoth I and IICorrect answerYour answerNeither I nor IICorrect answerYour answer

Show the answer and explanation

CorrectNot quiteAnswer A

Correct answer: A

I is true: each costs exactly M.
II is false: equal satisfaction is the property of an indifference curve, not of the budget line.

Ten questions from Budget Line & Optimal Choice, at your own pace.

Ten questions from Budget Line & Optimal Choice, at your own pace.

Read the two statements and choose the correct option.I. Every bundle on the budget line costs the same amount.II. Every bundle on the budget line gives the same satisfaction.