1) What is the important difference between the marginal-utility theory and the indifference-curve theory of consumer demand?

2) Explain why the budget line can be called “objective” and an indifference curve “subjective’. How will each of the following events affect the budget line?

a) A decrease in the money income of the consumer.

b) An increase in the prices of both products.

c) A decrease in the price of one of the products.