Multiple Choice
A consumer has preferences over two goods: x and y.Suppose we graph this consumer's preferences (which satisfy the usual properties of indifference curves) and budget constraint on a diagram with x on the horizontal axis and y on the vertical axis.At the consumer's current consumption bundle,the consumer is spending all available income,and the marginal rate of substitution is less than the slope of the budget constraint.We can conclude that
A) the consumer is currently maximizing satisfaction.
B) the consumer could increase satisfaction by consuming more x and less y.
C) the consumer could increase satisfaction by consuming less x and more y.
D) the consumer could purchase more x and more y and increase total satisfaction.
Correct Answer:

Verified
Correct Answer:
Verified
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