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Question
If the consumer has monotonic preferences, then can he/she be indifferent towards bundles (10, 8) and (8, 6)?
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Solution
No, he/she cannot be indifferent towards these two bundles as bundle I consists of more of both goods as compared to bundle II. He/she will prefer bundle I over bundle II as it contains 10 units of good 1 and 8 units of good 2 as compared to 8 units and 6 units of good 1 and good 2 respectively in bundle II.
RELATED QUESTIONS
What is meant by monotonic preferences?
What do you mean by monotonic preferences?
Suppose a consumer’s preferences are monotonic. What can you say about his/her preference ranking over the bundles (10, 10), (10, 9) and (9, 9)?
Suppose your friend is indifferent to the bundles (5, 6) and (6, 6). Are the preferences of your friend monotonic?
Answer the following question:
How would the demand for a commodity be affected by a change in the "tastes and preferences" of the consumers in favour of the commodity? Explain using a diagram.
Explain the following condition:
Shift from a lower to a higher indifference curve.
