Assume the graph shown represents Grace's budget constraint. Which of the following is true? Burritos 9 8 09 7 6 5 4 3 2 1 1 2 3 4 5 6 7 A Grace's total utility is constant along her budget constraint. B Grace's total spending is constant along her budget constraint. ... Salads The marginal utility Grace receives is the same for each combination of goods on her budget constrain D Grace is indifferent between consuming any bundle that lies on the budget constraint.
Assume the graph shown represents Grace's budget constraint. Which of the following is true? Burritos 9 8 09 7 6 5 4 3 2 1 1 2 3 4 5 6 7 A Grace's total utility is constant along her budget constraint. B Grace's total spending is constant along her budget constraint. ... Salads The marginal utility Grace receives is the same for each combination of goods on her budget constrain D Grace is indifferent between consuming any bundle that lies on the budget constraint.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:Assume the graph shown represents Grace's budget constraint. Which of the following is true?
Burritos
9
8
7
6
654
5
3
2
1
1 2 3
4 5 6
A Grace's total utility is constant along her budget constraint.
B Grace's total spending is constant along her budget constraint.
7
...
Salads
The marginal utility Grace receives is the same for each combination of goods on her budget constraint.
D Grace is indifferent between consuming any bundle that lies on the budget constraint.
Expert Solution

Step 1: Defining budget constraint
Budget constraint: given the price of 2 goods and consumer’s income. The budget constraint shows different combination of 2 goods such that consumer’s total expenditure is equal or less than the total income.
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