The utility-maximizing bundle of goods is found at the point of tangency between the budget constraint and an indifference curve.
In the following diagram, the utility-maximizing bundle is the one labeled point K. There are two different, but equally important, ways to interpret this point.
![1506_diagram.png](https://secure.tutorsglobe.com/CMSImages/1506_diagram.png)
a. Of the three points on the consumer's budget constraint (J, K, and L), what makes K special?
b. Of the three points on the consumer's indifference curve (M, K, and N), what makes K special?