Budget constraints exist for consumers because
a. their utility from consuming goods eventually reaches a maximum level.
b. even with unlimited incomes they have to pay for each good they consume.
c. they have to pay for goods, and they have limited incomes.
d. prices and incomes are inversely related.
c
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In his article, "The Nature of the Firm," Ronald Coase
a. suggested that monopolies may be more innovative than competitive firms b. argued that the economy should be organized into one large firm c. provided an answer to the question, "Why do firms exist?" d. focused on the concept of adverse selection e. analyzed concentration in U.S. industry
If output rises, then income
a. drops by an equal amount b. remains stable c. rises twice as fast as output d. rises slowly e. rises by an equal amount