MICROECONOMICS (LL)-W/ACCESS >CUSTOM<
11th Edition
ISBN: 9781264207718
Author: Colander
Publisher: MCG CUSTOM
expand_more
expand_more
format_list_bulleted
Question
Chapter 19.A, Problem 3QE
To determine
The shape of the indifference curve, if MRS was zero and constant.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Why do we expect that indifference curves will never cross?
Suppose we have the following utility
function: U(x,y)=x^O.33 y^0.67
1) What is the Marginal utility of x? Marginal
utility of y?
2) Comment on how the marginal utility of
each changes as x increases and discuss
why that makes sense.
3) Does this utility function follow the more
is better rule? How do you know?
4) What is the marginal rate of substitution
(MRS)? What do we know about the shape
of the indifference curve given this MRS?
5) Now suppose we have a new utility
function: U(x,y)=x+y. What type of goods
are these? Explain.
If a consumer is rational and maximizing utility, their Marginal Rate of Substitution will be equal to the price ratio. Why is this?
Chapter 19 Solutions
MICROECONOMICS (LL)-W/ACCESS >CUSTOM<
Ch. 19.1 - Prob. 1QCh. 19.1 - Prob. 2QCh. 19.1 - Prob. 3QCh. 19.1 - Prob. 4QCh. 19.1 - Prob. 5QCh. 19.1 - Prob. 6QCh. 19.1 - Prob. 7QCh. 19.1 - Prob. 8QCh. 19.1 - Prob. 9QCh. 19.1 - Prob. 10Q
Ch. 19.A - Prob. 1QECh. 19.A - Prob. 2QECh. 19.A - Prob. 3QECh. 19.A - Prob. 4QECh. 19 - Prob. 1QECh. 19 - Prob. 2QECh. 19 - Prob. 3QECh. 19 - Prob. 4QECh. 19 - Prob. 5QECh. 19 - Prob. 6QECh. 19 - Prob. 7QECh. 19 - Prob. 8QECh. 19 - Prob. 9QECh. 19 - Prob. 10QECh. 19 - Prob. 11QECh. 19 - Prob. 12QECh. 19 - Prob. 13QECh. 19 - Prob. 14QECh. 19 - Prob. 15QECh. 19 - Prob. 16QECh. 19 - Prob. 1QAPCh. 19 - Prob. 2QAPCh. 19 - Prob. 3QAPCh. 19 - Prob. 4QAPCh. 19 - Prob. 5QAPCh. 19 - Prob. 1IPCh. 19 - Prob. 2IPCh. 19 - Prob. 3IPCh. 19 - Prob. 4IPCh. 19 - Prob. 5IPCh. 19 - Prob. 6IPCh. 19 - Prob. 7IPCh. 19 - Prob. 8IPCh. 19 - Prob. 9IPCh. 19 - Prob. 10IP
Knowledge Booster
Similar questions
- Suppose that the following utility function is given U(X,Y) Which of the following is correct? We have non-convex preferences since Law of diminishing Marginal Rate of Substitution fails to hold and indifference curves are bowed outward from the origin We have non-convex preferences since Law of diminishing Marginal Rate of Substitution holds and indifference curves are bowed inward towards the origin We have convex preferences since Law of diminishing Marginal Utility holds and indifference curves are bowed outward from the origin We have convex preferences sincel Lawlof diminishing Marginal Rate of Substitution fails to hold and indifterence curves are bowed inward towards the originarrow_forwardWhy is the slope of an indifference curve convex? Which is the best indifference curve?arrow_forwardDoes a Budget constraint has only one individual indifference curve? Does every isocost line has a individual isoquant curve?arrow_forward
- Suppose that the following utility function is given U(x,Y) = x+Y Which of the following is соrect? We have non-convex preferences since Law of diminishing Marginal Rate of Substitution holds and indifference curves are bowed inward towards the origin We have convex preferences since Law of diminishing Marginal Utility holds and indifference curves are bowed outward from the origin We have convex preferences since Law of diminishing Margina Rate of Substitution holds and indifference curves are bowed inward towards the origin We have convex preferences since Law of diminishing Marginal Rate of Substitution fails to hold and indifference curves are bowedinward towards the originarrow_forwardSuppose preferences do not exhibit diminishing marginal rate of substitution. Can we set MRS=n to find the Golden Rule bundle?arrow_forwardIn the theory of consumer behavior, what are the three basic assumptions about individual preferences? What is an indifference curve? What is the Marginal Rate of Substitution (MRS)?arrow_forward
- if the utility function is given by u=x^2y^2 what is marginal utility?arrow_forwardWhy does the optimal consumption bundle occur where the budget line is tangent to the indifference curve?arrow_forwardUse the image 2.2 below to answer this question. The slope of the indifference curve is given by AY/AX, where Y is the good measured on the vertical axis and X is the good measured on the horizontal axis. The slope gives the marginal rate of substitution (MRS). The slope of an indifference curve (the MRS) also gives: Image 2.2 MUX a) MUY MUy b) MUX MUX c) Px MUX d) PY Py e) Px OA is correct OB is correct OC is correct OD is correct OE is correctarrow_forward
- Mrs. Griffiths earns $5000 a week and spends her entire income on dresses and handbags, since these are the only two items that provide her utility. Furthermore, Mrs. Griffiths insists that for every dress she buys, she must also buy a handbag. Draw an indifference curve showing the optimum choice. Label the optimum as point A. What would be the marginal rate of substitution at the point that corresponds to the optimal consumption choice? Interpret the marginal rate of substitutionarrow_forwardHow to explain indifference curve and also describe the properties of indifference curve?arrow_forwardA KU student maximizes his sporting utility by playing Golf (G) and Tennis (T). His function is given as: U(G,T) = G + T Graphically characterize the student’s indifference curve. What is the Marginal Rate of Substitution between Golf and Tennis What is the behaviour of the Marginal Rate of Substitution for these type of goods.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Economics (MindTap Course List)EconomicsISBN:9781337617383Author:Roger A. ArnoldPublisher:Cengage Learning
Economics (MindTap Course List)
Economics
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Cengage Learning