Asked by Fantasia Jessie on Jun 22, 2024
Verified
The limited money income of consumers results in a so-called budget constraint.
Budget Constraint
The limit that the size of a consumer’s income (and the prices that must be paid for goods and services) imposes on the ability of that consumer to obtain goods and services.
Money Income
The total amount of monetary earnings received by an individual or household over a certain period of time, before taxes and deductions.
- Grasp the significance of budget constraints in consumer choice.
Verified Answer
BP
Benjamin PullenJun 29, 2024
Final Answer :
True
Explanation :
A budget constraint represents the combinations of goods and services a consumer can purchase with their limited income, reflecting the trade-offs they must make based on their financial limitations.
Learning Objectives
- Grasp the significance of budget constraints in consumer choice.