The budget constraint describes the different bundles that the consumer can afford.

The marginal rate of substitution of meals for films is the quantity of films the consumer must sacrifice to increase the quantity of meals by one unit without changing total utility.

Consumer tastes exhibit a diminishing marginal rate of substitution when, to hold utility constant, diminishing quantities of one good must be sacrificed to obtain successive equal increases in the quantity of the other good.

An indifference curve shows all the consumption bundles yielding a particular level of utility.

Hence, the chosen bundle will be the point at which an indifference curve just touches the budget line. The budget line is a tangent to the indifference curve at this point.

The income expansion path shows how the chosen bundle of goods varies with consumer income levels.

The substitution effect of a price change is the adjustment of demand to the relative price change alone. The income effect of a price change is the adjustment of demand to the change in real income alone.

The market demand curve is the sum of the demand curves of all individuals in that market.

A transfer is a payment, usually by the government, for which the recipient provides no corresponding service. A transfer in kind is the gift of a good or service.

The marginal utility of a good is the increase in total utility obtained by consuming one more unit of that good, for given consumption of other goods.

A consumer has diminishing marginal utility from a good if each extra unit consumed, holding constant consumption of other goods, adds successively less to total utility.