8) Indifference curves are convex to the origin because of:A) transitivity of consumer preferences.B) they yield results consistent with observed behavior.C) the assumption that more is preferred to less.D) the assumption of completeness.E) none of the above

Indifference curves or ICs are graphical illustrations of a consumer's utility from a combination of…

Answered: 8) Indifference curves are convex to…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Suppose the tastes of an individual are represented by the following map of indifference curves: Good B Increasing utility Good A Which of the following statements best describes the individual's preferences? Convexity of preferences is violated Monotonicity of preferences is violated Both of the above are correct ○ None of the above is correct
Given above are some of the indifference curves for a student who consumes Burritos and Pizzas and the relevant budget line. Equilibrium is defined as the maximum utility or satisfaction given the consumer’s budget. The consumer has more indifference curves above I3, below I1, and between I1 and I2 and between I2 and I3. Out of all the indifference curves the consumer has, only I1, I2, and I3 are shown. The given budget line touches I2 at the point where I2 touches the y-axis (Burritos axis). a) If the price of Pizzas decreased and the price of Burritos remained unchanged, would the quantity of Burritos consumed at equilibrium increase or decrease compared to the equilibrium point A in the graph given above? (b) If the price of Pizzas increased and the price of Burritos remained the same, would the consumer equilibrium point be different from point A or the same as point A in the graph given above?
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A consumer consumption bundle contains good X and Y. Suppose the price of good X goes up and a consumer goes on consuming the exact same amount of X as before. Check the correct statement(s).A) Both X and Y are inferior. B) X is an inferior good.C) In the special case where X is Leisure, and Y is "all other goods", X is an inferior good.D) The consumption of Y decreases.E) It is impossible that the consumption of X remains unchanged when the price of × goes up.F) The substitution effect is negative
28) When measuring the substitution effect, one uses the change along A) the new indifference curve. C) the old indifference curve. B) the budget constraint. D) either the old or the new indifference curve.
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8) Indifference curves are convex to the origin because of A) transitivity of consumer preferences. B) they yield results consistent with observed behavior. C) the assumption that more is preferred to less. D) the assumption of completeness. E) none of the above