Question

When consumers maximize utility, they obtain:

A. the highest indifference curve that touches their budget constraint.
B. any intersection of the budget line and the indifference curve.
C. the lowest indifference curve that touches their budget constraint.
D. a point of intersection between indifference curves.

Answer 1

The answer is The highest indifference curve that touches their budget constraint.

Step-by-step explanation:

When consumers maximize utility this indicates that when a higher price for a good will cause the budget constraint to shift to the left, so that it is tangent to a lower indifference curve representing a reduced level of utility, exactly how much a change in price will lead to a quality demanded of each goods will depend on personal preferences.