All Courses
Explore Courses UPSC Exam UPSC Test Series Free Notes EduRev Infinity Get the App Login Join for Free
Sign in Open App
Commerce Exam  >  Commerce Questions  >  A budget constraint line is a result of?a)Mar... Start Learning for Free
A budget constraint line is a result of?
  • a)
    Market price of commodity X
  • b)
    Market price of commodity Y
  • c)
    Income of the consumer
  • d)
    All of above
Correct answer is option 'A'. Can you explain this answer?
Clear all your Commerce doubts with EduRev
Most Upvoted Answer
A budget constraint line is a result of?a)Market price of commodity Xb...
A budget constraint represents all the combinations of goods and services that a consumer may purchase given current prices within his or her given income. Consumer theory uses the concepts of a budget constraint and a preference map to analyze consumer choices.
Free Test
FREE
Start Free Test
Start Free Test
Community Answer
A budget constraint line is a result of?a)Market price of commodity Xb...
Explanation:

A budget constraint line is a graphical representation of the various combinations of two goods that a consumer can afford, given his/her income and the prices of the goods. It is also called a budget line or a price line.

The budget constraint line is a result of the market price of commodity X, which is one of the two goods that the consumer is considering purchasing. The market price of commodity Y is also a factor in determining the slope of the budget constraint line, but it is not the result of the line.

The income of the consumer is also an important factor in determining the position of the budget constraint line on the graph. The higher the income, the further out the line will be from the origin, indicating that the consumer can afford to purchase more of both goods.

However, the income of the consumer is not the result of the budget constraint line. It is simply a factor that is taken into account when drawing the line.

In summary, the budget constraint line is a result of the market price of commodity X, and to a lesser extent, the market price of commodity Y. The income of the consumer is a factor that is taken into account when drawing the line, but it is not the result of the line itself.

HTML:

Explanation:

  • A budget constraint line is a graphical representation of the various combinations of two goods that a consumer can afford, given his/her income and the prices of the goods. It is also called a budget line or a price line.

  • The budget constraint line is a result of the market price of commodity X, which is one of the two goods that the consumer is considering purchasing. The market price of commodity Y is also a factor in determining the slope of the budget constraint line, but it is not the result of the line.

  • The income of the consumer is also an important factor in determining the position of the budget constraint line on the graph. The higher the income, the further out the line will be from the origin, indicating that the consumer can afford to purchase more of both goods.

  • However, the income of the consumer is not the result of the budget constraint line. It is simply a factor that is taken into account when drawing the line.

  • In summary, the budget constraint line is a result of the market price of commodity X, and to a lesser extent, the market price of commodity Y. The income of the consumer is a factor that is taken into account when drawing the line, but it is not the result of the line itself.
Explore Courses for Commerce exam

Similar Commerce Doubts

Read the following passage and answer the questions that follows:In economics, rationing is an artificial restriction of demand and is done to keep price below the equilibrium (market-clearing) price determined by the process of supply and demand in an unfettered market. Thus, rationing can be complementary to price controls which can be explained through indifference curve approach.There are two kinds of rationing done by the government to reduce consumption—price rationing and non-price rationing. By rationing, we mean exercise tax and by non-price rationing, we mean all types of control on the quantity consumed. Non-price rationing could be done by giving away coupons that would enable low income families to obtain some goods at affordable prices, which could not be possible if the prices were to increase alone. With coupon schemes, it would develop a black market for coupons, which would paradoxically increase the utility for those who are in need of that commodity by collection of more of these coupons from those who are not in need. This ensures greater marginal utility for those people who are in need of the commodity and will provide exchange of money to those who sell these coupons. For this, it is necessary for the government to encourage trading of the coupons.The major importance of introducing rationing is to keep the price of important commodities under control, as for a necessary commodity, there will be an excessive demand in the market which will drive their price up in the market and high prices leads to reduction of consumption and utility for those who could not afford it. This ensures that the resources are planned in favour of the poor people of the country and restricts the rich people to ensure excessive purchase of limited resources of the country. This ensures development and equality of welfare and utilitybetween the rich and the poor people. Rationing of the good is done by the government and not the private sector. There is the same limit put on every person on the budget spending to which people could buy the commodities and within the limit, one could buy any amount of the commodity.Q. The marginal utility derived from a commodity keeps on ..................... .

Read the following passage and answer the questions that follows:In economics, rationing is an artificial restriction of demand and is done to keep price below the equilibrium (market-clearing) price determined by the process of supply and demand in an unfettered market. Thus, rationing can be complementary to price controls which can be explained through indifference curve approach.There are two kinds of rationing done by the government to reduce consumption—price rationing and non-price rationing. By rationing, we mean exercise tax and by non-price rationing, we mean all types of control on the quantity consumed. Non-price rationing could be done by giving away coupons that would enable low income families to obtain some goods at affordable prices, which could not be possible if the prices were to increase alone. With coupon schemes, it would develop a black market for coupons, which would paradoxically increase the utility for those who are in need of that commodity by collection of more of these coupons from those who are not in need. This ensures greater marginal utility for those people who are in need of the commodity and will provide exchange of money to those who sell these coupons. For this, it is necessary for the government to encourage trading of the coupons.The major importance of introducing rationing is to keep the price of important commodities under control, as for a necessary commodity, there will be an excessive demand in the market which will drive their price up in the market and high prices leads to reduction of consumption and utility for those who could not afford it. This ensures that the resources are planned in favour of the poor people of the country and restricts the rich people to ensure excessive purchase of limited resources of the country. This ensures development and equality of welfare and utilitybetween the rich and the poor people. Rationing of the good is done by the government and not the private sector. There is the same limit put on every person on the budget spending to which people could buy the commodities and within the limit, one could buy any amount of the commodity.Q. ______ means the utility derived from the total number of products consumed (choose the correct alternativ e).

Read the following passage and answer the questions that follows:In economics, rationing is an artificial restriction of demand and is done to keep price below the equilibrium (market-clearing) price determined by the process of supply and demand in an unfettered market. Thus, rationing can be complementary to price controls which can be explained through indifference curve approach.There are two kinds of rationing done by the government to reduce consumption—price rationing and non-price rationing. By rationing, we mean exercise tax and by non-price rationing, we mean all types of control on the quantity consumed. Non-price rationing could be done by giving away coupons that would enable low income families to obtain some goods at affordable prices, which could not be possible if the prices were to increase alone. With coupon schemes, it would develop a black market for coupons, which would paradoxically increase the utility for those who are in need of that commodity by collection of more of these coupons from those who are not in need. This ensures greater marginal utility for those people who are in need of the commodity and will provide exchange of money to those who sell these coupons. For this, it is necessary for the government to encourage trading of the coupons.The major importance of introducing rationing is to keep the price of important commodities under control, as for a necessary commodity, there will be an excessive demand in the market which will drive their price up in the market and high prices leads to reduction of consumption and utility for those who could not afford it. This ensures that the resources are planned in favour of the poor people of the country and restricts the rich people to ensure excessive purchase of limited resources of the country. This ensures development and equality of welfare and utilitybetween the rich and the poor people. Rationing of the good is done by the government and not the private sector. There is the same limit put on every person on the budget spending to which people could buy the commodities and within the limit, one could buy any amount of the commodity.Q. The marginal utility of a person diminishes.

Top Courses for CommerceView all

Top Courses for Commerce

A budget constraint line is a result of?a)Market price of commodity Xb)Market price of commodity Yc)Income of the consumerd)All of aboveCorrect answer is option 'A'. Can you explain this answer?
Question Description
A budget constraint line is a result of?a)Market price of commodity Xb)Market price of commodity Yc)Income of the consumerd)All of aboveCorrect answer is option 'A'. Can you explain this answer? for Commerce 2025 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about A budget constraint line is a result of?a)Market price of commodity Xb)Market price of commodity Yc)Income of the consumerd)All of aboveCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for Commerce 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A budget constraint line is a result of?a)Market price of commodity Xb)Market price of commodity Yc)Income of the consumerd)All of aboveCorrect answer is option 'A'. Can you explain this answer?.
Solutions for A budget constraint line is a result of?a)Market price of commodity Xb)Market price of commodity Yc)Income of the consumerd)All of aboveCorrect answer is option 'A'. Can you explain this answer? in English & in Hindi are available as part of our courses for Commerce. Download more important topics, notes, lectures and mock test series for Commerce Exam by signing up for free.
Here you can find the meaning of A budget constraint line is a result of?a)Market price of commodity Xb)Market price of commodity Yc)Income of the consumerd)All of aboveCorrect answer is option 'A'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of A budget constraint line is a result of?a)Market price of commodity Xb)Market price of commodity Yc)Income of the consumerd)All of aboveCorrect answer is option 'A'. Can you explain this answer?, a detailed solution for A budget constraint line is a result of?a)Market price of commodity Xb)Market price of commodity Yc)Income of the consumerd)All of aboveCorrect answer is option 'A'. Can you explain this answer? has been provided alongside types of A budget constraint line is a result of?a)Market price of commodity Xb)Market price of commodity Yc)Income of the consumerd)All of aboveCorrect answer is option 'A'. Can you explain this answer? theory, EduRev gives you an ample number of questions to practice A budget constraint line is a result of?a)Market price of commodity Xb)Market price of commodity Yc)Income of the consumerd)All of aboveCorrect answer is option 'A'. Can you explain this answer? tests, examples and also practice Commerce tests.
Explore Courses for Commerce exam

Top Courses for Commerce

Explore Courses
SaveJoin the Discussion on the App for FREE
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
10M+ students study on EduRev
Get App
© EduRev
Education Revolution
Signup to see your scores go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup