Aunty Bree is attending UWA and likes to eat a meal at lunchtime. Apart from price,

Aunty Bree's decisions on where to eat are based on her tastes for food quality and

pleasantness of the surroundings (Aunty Bree is a party girl likes to socialise with

other students). Assume that she has three choices to eat at:

i.

The University Guild Caf - which has equal amounts of food quality and

pleasantness of surroundings.

ii.

Varsity Bar - which has a greater emphasis on the pleasantness of

surroundings than food quality.

iii.

Nedlands Restaurant - which has a greater emphasis on the food quality than

the pleasantness of surroundings.

a) Using characteristics analysis with indifference curves, illustrate a situation

where Aunty Bree would only dine at Varsity Bar. Also illustrate the levels of

food quality and pleasantness Aunty Bree receives from dining at Varsity.

b)Indicate on the diagram, the levels of food quality and pleasantness that Aunty Bree would need to shift from only dining at Varsity Bar to be indifferent from dining at Varsity Bar, the University Guild Cafe and Nedlands Restaurant. What would the University Guild Cafe and Nedlands Restaurant need to do to make Aunty Bree change her preference for solely consuming at Varsity Bar.