Question
4. Suppose an individual's preferences can be represented by the utility function U(x,y) = x^2 + y . a) Sketch a set of indifference curves
4. Suppose an individual's preferences can be represented by the utility function U(x,y) = x^2 + y .
a) Sketch a set of indifference curves for this utility function.
b) Show that this individual's preferences violate diminishing MRS.
c) These types of indifference curves are often used to illustrate "addictive" behavior. Briefly explain why. Hint: think about how the MRS changes along an indifference curve.
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Intermediate Microeconomics
Authors: Hal R. Varian
9th edition
978-0393123975, 393123979, 393123960, 978-0393919677, 393919676, 978-0393123968
