Multiple choice

A consumer is said to be in equilibrium if

  1. he is able to fulfil his needs with a given level of income

  2. he is able to live in full comfort with a given level of income

  3. he can fulfil his needs without consumption of certain items

  4. he is able to locate new sources of income
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A Correct answer
Explanation

Consumer equilibrium occurs when a consumer maximizes utility given their income constraint and prices. This means they can fulfill their needs optimally within their budget allocation, achieving maximum satisfaction.

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