Previous | Next | Chapter 5, General Equilibrium
Topic: Exercise 5.15
Conf: Chapter 5, General Equilibrium, Msg: 14690
From: Carol Tong (lilimuke@hotmail.com)
Date: 4/16/2004 12:33 PM

Exercise 5.15 Carol Tong cfa1 lilimuke@hotmail.com Because consumer 1 prefers x1 to x2, the indifference curve of consumer 1 shows that he is willing use more x2 to exchange x1.If units of x1 are measured along each horizontal side and units of x2 along each vertical side, the indifference curve of consumer 1 looks steeper than consumer 2's.
Is my reasoning about sketching the consumers' preference right?
Thank you.