When the Budget Line Is Just Tangent to the Highest

question 131

Multiple Choice

When the budget line is just tangent to the highest achievable indifference curve,then _____.

• A)the consumer is in equilibrium
• B)the consumer should purchase more of good X
• C)the consumer should purchase more of good Y
• D)the consumer cannot afford the combination represented by the tangency point
• E)the consumer should purchase less of both goods

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Definitions:

Massachusetts Supreme Court

The highest court in the Commonwealth of Massachusetts, responsible for interpreting and applying the law.

Commonwealth v. Hunt

A landmark 1842 Massachusetts Supreme Court case that declared labor unions and strikes legal for the first time in the United States.

Labor Unions

Organizations formed by workers to protect their rights and interests, negotiate with employers over wages, benefits, and working conditions.

National Industrial Recovery Act

A 1933 U.S. law aimed at boosting economic growth during the Great Depression through industrial codes of fair competition and workers' right to unionize.