Figure 6A-4 Hugh’s Utility-Maximizing Choice
6A.3 The Consumer’s Utility--
Maximizing Choices
An indifference map describes the preferences of a consumer, and a
budget line describes the possibilities available to a consumer. To predict
what a consumer will actually do, both sets of information must be
combined, as is done in Figure 6A-4. Hugh’s budget line is shown by
the straight line, and the curves from the indifference map are also
shown. Any point on the budget line is attainable, but which point will
Hugh actually choose?
The consumer’s utility is maximized at A, where an indifference curve
is tangent to the budget line. Hugh has a money income of $720 per