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13-utility max jpw

13-utility max jpw - Utility Maximization Lecture...

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microL13-S2010-page http://www.arts.cornell.edu/econ/wissink/econ1110jpw/ Utility Maximization Lecture 13-PREVIEW Dr. Jennifer P. Wissink ©2009 John M. Abowd and Jennifer P. Wissink, all rights reserved. March 8, 2010
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microL13-S2010-page http://www.arts.cornell.edu/econ/wissink/econ1110jpw/ Recall: Indifference Curve Maps Preferences that are described by the “at least as good as operator” can be represented by indifference curve maps. A particular indifference curve connects all of the bundles that a consumer likes equally. that is all bundles for which B 0 IN B 1 . An indifference curve map is ALL the indifference curves. Indifference Curve Maps and Their 5 Properties Every bundle lives on some indifference curve – the indifference curve “map” is like a dense forest of indifference curves. Indifference Curves never slope “up” Indifference Curves never cross each other. Indifference Curves never “bow-out”, they are either linear or “bowed-in” Better bundles are on indifference curves to the “north-east”
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microL13-S2010-page http://www.arts.cornell.edu/econ/wissink/econ1110jpw/ Proving IC Map Properties Indifference Curves never “bow-out”, they are linear or “bowed-in”
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microL13-S2010-page http://www.arts.cornell.edu/econ/wissink/econ1110jpw/
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