Q: Draw and interpret Shahab’s indifference curves for 10 rupee notes and 20 rupee notes and his…
A: Indifference curve (IC) shows all the combination of two goods in which the consumer is indifferent.…
Q: It is known that the indifference curve is convex. What does this tell you about the relationship…
A: The indifference curve refers to the graphical representation of different combinations of two goods…
Q: Consider the following indifference curves. MRS =-1 U4 U2 U3 UI Suppose the price of X is $1.50 per…
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Q: What information is contained in an indifference curve? Why are such curves Downward sloping
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Q: If the slope of indifference curve is -0.8 and the change in X axis is 8, what is the change in Y…
A: A consumer maximizes his utility by consuming at a point where the indifference curve of the…
Q: Consider the following indifference curves. U1 U3 U4 U2 Which indifference curves violate the…
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Q: Is the indifference curve of U(x1,x2)=max(x1,x2) considered to be the curve for a perfect complement…
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A: An indifference curve, with respect to two commodities, is a graph showing those combinations of the…
Q: Can indifference curves be thick? The figure to the right shows a thick indifference curve Relative…
A: The indifference curve is the combination of different bundles of two goods. All these bundles give…
Q: Define the indifference map for an individual.
A: The want satisfying power of a commodity is termed as the utility. As a consumer consumes a good…
Q: an an indifference curve cross itself?
A: Indifference curve(IC) shows all possible combination of two-goods such that each combination…
Q: t is known that the indifference curve is convex.
A: GIVEN It is known that the indifference curve is convex. What does this tell you about the…
Q: Q) U = xy and y = x(1+y) Are points (1,9) and (5,1) on the same indifference curve? Explain it…
A: An Indifference curve represents different combinations of two goods ( say , good X and good Y )…
Q: Determine which, if any, of Properties 4–1 through 4–4 are violated by the indifference curves shown…
A: An indifference curve is a graph showing combinations of two goods that give the consumer equal…
Q: What information is contained in an indifference curve? Why are such curves Convex to the origin
A: Indifference curve (IC) is an important concept in consumer theory under micro economics.
Q: An indifference curve diagram has movies on the vertical axis and sodas on the horizontal. As the…
A: Marginal rate of substitution is defined as the number of units of commodity 'x' a consumer is…
Q: Which one of the following is incorrect about the indifference curves? All combinations in an…
A: Indifference Curve: An indifference curve represents various combinations of two commodities that…
Q: Which indifference curves violate the assumption of monotonicity? U3 only. U1 and U3. U1, U3 and U4.…
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Q: Given the indifference curve shown to the right: Q 10- a. What is the marginal rate of substitution…
A: * answer :- * a) Marginal Rate of Substitution = Change in good Y ( books)/ change in good X( CD)…
Q: Consider the following equation for an indifference curve: y = 20/x. At point A (2, 10), the MRS is?
A: The indifference curve shows us the consumption of two commodities that are consumed by the consumer…
Q: Why indifference curves never intersect. Prove graphically?
A: IC(indifference curve) shows us the various combination of two products/goods where the buyer is…
Q: 47. When indifference curve is L shaped, then two goods will be
A: Answer is given below
Q: Explain the derivation of the demand curve of a consumer using the indifference curve theory.
A: At the utility-expanding arrangement, the consumer's marginal pace of replacement (the total worth…
Q: Consider the following equation for an indifference curve: y = 20/x. At point A (2, 10), the MRS is?
A: Given data: The equation for indifference curve is y=20x Point is A2, 10
Q: Explain how indifference curves can never cross.
A: Indifference curves can never cross each other. We can explain this with the help of the two axioms…
Q: e marginal rate of substitution measures the distance between one indifference curve and tne •True
A: Marginal Rate of Substitution : The Marginal Rate of Substitution can be defined as the amount of…
Q: Comparing the slope of the budget line (Opportunity Cost of Good Y) with the slope of the…
A: Below is the edited graph:
Q: Joe's indifference map for lobster (L) and soda (S) is shown in Figure 4.9 below along with his…
A: Optimal consumption bundle which maximizes consumer's utility is where budget line is tangent to an…
Q: Explain what is meant by the Income and Substitution Effects? With the help of standard Indifference…
A: The interaction between the income and substitution effects will determine how the quantity required…
Q: Explain why crossing indifference curves would lead to a logical inconsistency.
A: Indifference curves: Indifference curves show the various combinations of two goods that allow for…
Q: Which feature of indifference curves guarantees this result? a. Concavit of indifference curves b.…
A: An indifference curve(IC) is a locus/contour of the different bundle that has the same utility at…
Q: Why is it impossible for two indifference curves to intersect one another?
A: Indifference curves show various combinations of goods between which the consumers are indifferent.…
Q: A convex indifference curve implies what type of behavior? diminishing marginal utility…
A: Indifference curve are defined as the locus of the points with same utility level at each point.
Q: Since the consumer is indifferent between all points on an indifference curve, no point is…
A: According to the consumer theory, if an individual is consuming the positive amount of two goods…
Q: Which of the following is NOT true about indifference curves? O They are downward sloping O They do…
A: An Indifference curve is a locus of the combination of all the points that represent a different…
Q: Q.2 The slope of the indifference curve is equal to which of the following? A. One B. Marginal…
A: According to the given question Indifference curve was first named by the economist Pareto it…
Q: Define A consumer prefers a higher indifference curve to a lower one.
A: An ‘indifference curve(IC)’ refers to a graph that shows the combinations of two commodities. These…
Q: If a consumer is indifferent between two consumption bundles: The two bundles lie outside the budget…
A: Ans 1) A consumer is a person who demands goods and services. He chooses between different variety…
Q: A higher indifference curve shows
A: A higher indifference curve shows higher level of
Q: Outline the four properties that apply to all indifference curves.
A: Indifference curve shows the combination of two good that gives the same level of satisfaction to…
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- Take Jeremys total utility information in Exercise 6.1, and use the marginal utility approach to confirm the choice of phone minutes and round trips that maximize Jeremys utility.Who determines how much utility an individual will receive from consuming a good?Praxilla, who lived in ancient Greece, derives utility from reading poems and from eating cucumbers. Praxilla gets 30 units of marginal utility from her first poem 27 units of marginal utility from her second poem 24 units of marginal utility from her third poem, and so on, with marginal utility declining by three units for each additional poem. Praxilla gets six units of marginal utility for each of her next three cucumbers consumed, five units of marginal utility for each of her next three cucumbers consumed, four units of marginal utility for each of the following three cucumbers consumed, and so on, with marginal utility declining by one for every three cucumber consumed. A poem costs three bronze coins hut a cucumber costs only one bronze coin. Praxilla has 18 bronze coins. Sketch Praxillas budget set between poems and cucumbers, placing poems on the vertical axis and cucumbers on the horizontal axis. Start off with the choice of zero poems and 18 cucumbers, and calculate the changes in marginal utility of moving along the budget line to the next choice of one poem and 15 cucumbers. Using this step-by-step process based on marginal utility, create a table and identify Praxillas utility—maximizing choice. Compare the marginal utility of the two goods and the relative prices at the optimal choice to see if the expected relationship holds. Hint: Label the table columns: 1) Choice, 2} Marginal Gain from More Poems, 3) Marginal Loss from Fewer Cucumbers, 4) Overall Gain or Loss, 5) Is the previous choice Optimal? Label the table rows: 1) 0 Poems and 18 Cucumbers, 2) 1 Poem and 15 cucumbers, 3) 2 Poems and 12 cucumbers, 4) 3 Poems and 9 Cucumbers, 5) 4 Poems and 6 cucumbers 6) 5 Poems and 3 Cucumbers, 7) 6 Poems and 0 Cucumbers.
- Total utility is maximized in the consumption oftwo goods by equating thea. prices of both goods for the last dollar spenton each good.b. marginal utilities of both goods for the lastdollar spent on each good.c. ratios of marginal utility to the price of bothgoods for the last dollar spent on each good.d. marginal utility of one good to the price ofthe other good.Bill gets 100 utils from eating one candy bar per day. He gets 120 utils from eating two candy bars per day. Calculate the marginal utility. O. 220 utils 100 utils 120 utils 20 utils Tamera calculates her utility for two hours of studying each day to be 300 utils. Her total utility for three hours is also 300 utils. Calculate the marginal utility. 300 utils 600 utils O 150 utils no marginal utility39. The following chart shows thec total utility-that Ammar receives from çonşuming various amounts-of chocolate.candy bars each day: Number candy, bars consumed për đay Total'utility 1' 40- 2 70 90 100 4. 80 Which of the following statements about Ammar's marginal utility is correct? Hiş marginal utility from the first candy bar is greater-than his marginalutility from the second candy' bar
- Question 9 If we observe that a consumerâ s budget constraint has shifted inward, we can assume that the consumer will buy O more normal goods and fewer inferior goods O more normal goods and more inferior goods O fewer normal goods and more inferior goods fewer normal goods and fewer inferior goods O OIn the short-run production period with one variable input (labor), when the average product of labor (APL) is increasing the marginal product of labor (MPL) must be; O a. more than APL. O b. decreasing. O c. will be less than APL. O d. increasing.What price ÅSsuming do you line and budget that understand by line? Consumer has income of $180, which monthly he Spends Good' X on two commodities and Grood Y. The price l07 Good $13 and price of the is $24. What would ' be Combinations of Crood X is Various Good Y this combinations line regard? and in and write draw various budget according ly?
- Five consumers have the following marginal utility ofapples and pears:Marginal Utilityof ApplesMarginal Utilityof PearsClaire 6 12Phil 6 6Haley 6 3Alex 3 6Luke 3 12The price of an apple is $1, and the price of a pear is$2. Which, if any, of these consumers are optimizingtheir choices of fruit? For those who are not, howshould they change their spending?The diagram below shows the Total Effect (the sum of Income & Substitution Effects) when the budget line moves from BO to BI, it shows that; Substilie. Effact Toral Effect O a. Price of X increase and X is Giffen good. O b. Price of X decreases and X is normal good. O c. Price of X increase and X is inferior good. Price of X incregse and X is normgl good.Quantity 1 2 3 4 Muffins Marginal Utility 80 70 O a. 145 utils. O b. 331 utils. O c. 96 utils. O d. 146 utils. O e. 56 utils. 60 50 Grapefruit Marginal Utility 75 72 66 62 5 40 56 Refer to the above information to answer this question. If Erica has a budget of $5 and the price of a muffin is $2 and a grapefruit is $1, what will be the total utility of her optimal purchase?