Question
Mary Granola consumes only avocados (x1) and grapefruits (x2) and never gets tired of them (i.e., she always prefers to have more of each good).
Mary Granola consumes only avocados (x1) and grapefruits (x2) and never gets tired of them (i.e., she always prefers to have more of each good). If we graph Mary Granola's indifference curves with avocados on the horizontal axis and grapefruits on the vertical axis, then whenever she has more grapefruits than avocados, the (absolute value of) slope of her indifference curve is 2. Whenever she has more avocados than grapefruits, the (absolute value of) slope is 1/3. Determine whether each of the following statements is true or false, and provide a brief explanation. (a) Mary would prefer (9, 12) to (12, 9). (b) Mary would be indifferent between (14, 20) and (22, 14). (c) Mary's preferences are convex.
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