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Consumer Equilibrium Class 11 Notes Free May 2026

This is the graphical method considered more realistic because it doesn't assume utility is measurable.

Real life involves choosing between multiple goods (e.g., Apples & Oranges). consumer equilibrium class 11 notes free

Condition for Equilibrium: The consumer will allocate income such that the last rupee spent on each good yields the same marginal utility. This is the graphical method considered more realistic

Formula: [ \fracMU_xP_x = \fracMU_yP_y = MU_m ] Budget Line (Price Line): A straight line showing

Rationale:

  • Budget Line (Price Line): A straight line showing all possible combinations a consumer can buy with their income.