Karen consumes chocolate and candles. Which of the following situations arises at Karen's best affordable point?
At her best affordable point, Karen is

Question

Karen consumes chocolate and candles. Which of the following situations arises at Karen's best affordable point? 
 At her best affordable point, Karen is

Answer

on her budget line, on her highest attainable indifference curve, and has a marginal rate of substitution between chocolate and candles that is equal to the relative price of chocolate.

Answer

on the indifference curve that is farthest from the origin and she maximizes the marginal rate of substitution between chocolate and candles.

Answer

on her budget line, on her highest attainable indifference curve, and she maximizes the marginal rate of substitution between chocolate and candles.

Answer

on or inside her budget line, on her highest attainable indifference curve, and has a marginal rate of substitution between chocolate and candles that is equal to the relative price of chocolate.

Answer

on the indifference curve that is closest to the origin and she minimizes the marginal rate of substitution between chocolate and candles.

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Karen consumes chocolate and candles. Which of the following situations arises a...

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