A Consumer's Budget Constraint Changes Slope Whenever

question 34

Multiple Choice

A consumer's budget constraint changes slope whenever:

• A) the consumer buys a different combination of goods.
• B) relative prices change.
• C) the consumer's income increases.
• D) an indifference curve is tangent to it.
• E) absolute prices change.

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Definitions:

Salespersons' Commissions

This refers to the payment made to sales staff based on a percentage of the sales they generate, as a form of incentive and reward.

Product Cost

The total expenditure incurred to produce, acquire, and sell products, including direct materials, direct labor, and overhead.

Period Cost

Overheads not directly linked to production, charged as expenses in the timeframe they happen.

Direct Materials

The raw materials directly used in the manufacturing of a product, easily traceable to the finished good.