Explain the optimal choice of consumer …

The budget set comprises of all bundles that are obtainable to the customer. The customer can pick his or her utilisation bundle from the set of budget.

The customer can manage to afford product B, but that point is that the product on a lower indifference curve and therefore, furnishes the customer less contentment. The optimal constitutes the best combination of utilisation of Pepsi and Burger obtainable to the customer.

In economics, it is presumed that the customer picks her utilisation bundle on the basis of her preferences and taste over the bundles in the set of budget. It is normally assumed that the customer has well interpreted preferences over the set of all possible bundles. She can compare any two bundles. In other words, between any two bundles, she either prefers one to the other or she is indifferent between the two.

It is normally presumed that the customer is a logical individual. A logical individual certainly would be aware of what is good or what is bad for him or her and in any given case, the customer always attempts to attain the best for themselves. Not only does a customer have distinct preferences over the set of obtainable bundles, they also behave according to their proclivity. From the bundles which are obtainable to them, a logical customer always picks the one which gives them utmost contentment.