Question

The graph to the right illustrates​ Jessica's preferences for pizza and Coke using indifference curves ​(Upper I 1I1​, Upper I 2I2​, Upper I 3I3​, and Upper I 4I4​). Use the point drawing tool to indicate a bundle of pizza and Coke that Jessica would prefer to bundle A​ (Bundle B), a bundle for which Jessica would be indifferent with bundle A​ (Bundle C), and a bundle that would be inferior to bundle A​ (Bundle D). Draw each bundle such that it corresponds to a level of utility represented by one of the indifference curves shown in the graph. Properly label the points. Carefully follow the instructions​ above, and only draw the required objects.   0246810121416182002468101214161820Pizza (slices per week)Coke (cans per week) Upper I 1I1 Upper I 2I2 Upper I 3I3 Upper I 4I4 Bundle Upper ABundle A

6486&centerwin#yes 5/21/19 4:26 PM | wiLFRIDAH OKEYO Submit Quiz This Quiz: 9 pts possible 2 of 9 (1 complete) Coke using at Jessica uld be fernor to bundle of utility Properly label d objects 12 1416 18 20 Pizza (sices per week)

Answer 1

Answer

The indifference curve shows the different combinations of consumption of two goods for which the consumer is indifferent. As all the consumption bundles on an indifference curve shows the same utility level ,so the consumer is indifferent among the bundles on the same indifference curve.The higher the indifference curve,the higher would be the utility, and lower the indifference curve, the lower would be the utility. With the given money income, a consumer would always prefer a higher indifference curve, that is attainable with her money income, as it would give her higher utility.

A bundle of pizza and coke that Jessica would prefer to bundle A (bundle B)

The Bundle of pizza and coke,say bundle 'B' that Jessica would prefer to bundle 'A' , would lie on the indifference curve that is to the right of indifference curve I₂, where bundle 'A ' is situated. The indifference curves that are to the right of I₂, give Jessica higher utility than bundle 'A'.The following figure shows the bundle of pizza and coke that Jessica would prefer to bundle 'A'.

In the above figure, bundle 'B' gives higher utility than at bundle 'A'. The bundle 'B' is situated on indifference curve I₃. All the bundles on I₃ give the same utility. So bundle 'B' may situate at any point on I₃. The bundle 'B' may situate at I₄ also. Both I₃ and I₄ give higher utility than I₂., and Jessica would prefer any bundle on I₃ , and I₄ , than bundle 'A' on I₂.

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A bundle for which Jessica would be indifferent with bundle A​ (Bundle C)

A bundle, say bundle 'C' for which Jessica would be indifferent with bundle 'A' would lie on the same indifference curve, which the bundle 'A' lies on. The following figure shows a bundle, bundle 'C' for which Jessica would be indifferent with bundle 'A​'.

In the above figure, all the bundles on indifference curve I₂ , shows the same utility level. So Jessica is indifferent for all the bundles situated on I₂. Bundle 'C' may lie anywhere on I_2. Whatever be the position of bundle 'C' on I₂,Jessica would be indifferent with bundle 'A' and bundle 'C'.Though the combination of goods at bundle 'C' is different from bundle 'A', both of the bundles provide the same utility.

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A bundle that would be inferior to bundle A​ (Bundle D)

A bundle, say bundle 'D' that would be inferior to bundle A​ would lie on the indifference curve which is to the left of I₂ , on which bundle 'A' is situated.Any bundle on the indifference curve to the left of I₂ is inferior to bundle 'A', as it gives lower utility than bundle 'A'.

The following figure shows a bundle, say bundle 'D' that would be inferior to bundle A​ .

In the above figure, bundle 'D' is situated on I₁, which is to the left of I₂. I₁ gives lower utility. So bundle 'D' which may situate at any point on I_1, is inferior to bundle 'A'.

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