A Budget Line

question 254

Multiple Choice

A budget line

• A) shows the limits to what can be consumed.
• B) has a slope equal to a relative price.
• C) rotates or shifts only when the consumer's budget changes.
• D) Answers B and C are both correct.
• E) Answers A and B are both correct.

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Definitions:

Maximize Joint Profits

A strategy where entities collaborate to enhance their combined earnings rather than competing against each other.

Incentive to Cheat

The motivation or factor that encourages individuals or entities to act dishonestly or unethically for personal gain.

Cartel

An agreement among competing firms to control prices, production, and market shares, often to maximize collective profits by reducing competition.

Organization of Sellers

A collective or group of sellers or producers that aims to promote common interests, often including market and price controls.