Suppose a company (such as Apple) is very successful through marketing/advertising in persuading consumers about the value of their products. Assume you want to represent the indifference curve between an Apple product and everything else of a typical consumer. You have quantity of Apple products on the horizontal axis and the quantity of all other products on the vertical axis. How would the indifference curve look like after the marketing campaign comparing with before? ie: will it be flatter or steeper and why? Explain
Suppose a company (such as Apple) is very successful through marketing/advertising in persuading consumers about the value of their products. Assume you want to represent the indifference curve between an Apple product and everything else of a typical consumer. You have quantity of Apple products on the horizontal axis and the quantity of all other products on the vertical axis. How would the indifference curve look like after the marketing campaign comparing with before? ie: will it be flatter or steeper and why? Explain
Utility refers to the amount of satisfaction received by the consumers from the consumption of a good or service. The utility function measures the amount of satisfaction received by the consumers.
An indifference curve illustrates the combinations of two goods that will give the same amount of satisfaction to a consumer. The slope of the indifference curve represents the marginal rate of substitution.
Step by step
Solved in 2 steps
