Microeconomics:
4th Edition
ISBN: 9781464143878
Author: Paul Krugman
Publisher: Worth Publishers
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Question
Chapter 10A, Problem 1P
To determine
To draw:
A diagram containing, three of Isabella’s indifference curve for the following situations.
Concept Introductions:
Indifference curve: The indifference curve is a line showing all possible combinations of two goods which give the consumers equal satisfaction. In other words the consumer would be indifferent in these points.
Expert Solution & Answer
Explanation of Solution
- If we Isabella want four tires for one car her indifference curve will look like the above given graph.
- In this situation the indifference curves for Isabella will be downward sloping as shown in the above graph
- In this situation the indifference curve for Isabella will be convex to the origin. This type of indifference curves is normal.
- The indifference curve for the bindings and skis for Isabella is shown in the above graph.
- Isabella’s indifference curve for water and soda are given above in the, in this case the indifference curve will be a vertical one.
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