Which of the following are necessary ingredients to the buyer's problem in microeconomics?

• A. Prices
• B. Preferences
• C. Production technology
• D. Income

Answer: (D)

Verified step by step guidance

1. Step 1: Understand the buyer's problem in microeconomics, which involves how a consumer chooses the best bundle of goods given certain constraints.
2. Step 2: Identify the necessary components for the buyer's problem: the consumer's preferences, which represent their tastes and satisfaction from different bundles of goods.
3. Step 3: Recognize that prices of goods are essential because they determine the cost of each bundle the consumer might choose.
4. Step 4: Acknowledge that income (or budget) is necessary as it limits the total amount the consumer can spend on goods.
5. Step 5: Note that production technology is not part of the buyer's problem since it relates to how goods are produced, which is relevant to the producer's problem, not the consumer's.