A CONSUMERS ECONOMIC CIRCUMSTANCES Flashcards
1
Q
All the options we can choose from our given constraints
A
Consumers choice set
2
Q
Limit on the kinds of choices that are available to us
Something that controls what you do by keeping you with particular limits
A
Constraints
3
Q
6 types of constraints
A
- current income
- assets (savings) something you can own from monetary value
- time (always limited)
- future income (for borrowing)
- psychological ch 29
4
Q
Economic agents that cannot influence the prices in the economy
A
Price takers
5
Q
Other term for Exogenous Income
A
Fixed Income
6
Q
It represents all combinations of good which, if chosen by a particular consumer, would leave no additional money left in his or her budget
Shows various combinations of two or more goods that the consumers can afford
It tells individual is able to buy
A
Budget Line
7
Q
2 characteristics of BUDGET LINE
A
- Price Change
- Income change
