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the consumer what her preferences are for alternative bundles of goods. Which

do you prefer, 5 units of X and 10 units of Y, or 7 units of X and 6 units of Y? The

answers to enough of such questions generate a preference ranking for a wide

range of possible bundles of goods. Figure 3A.1 shows these possible bundles by

FIGURE 3A.1

A Consumer’s

Indifference Curves

Each indifference

curve shows

combinations of the

goods that provide the

consumer with the

same level of welfare.

Appendix to Chapter 3 Consumer Preferences and Demand 121

16

15

14

13

12

10

9 8 7 6 5 4 3 2 1

11

0 1 2 3 4 5 6 7 8 9 10 11 12

Quantity of Good Y

Quantity of Good X

F

E

D

C

B

A

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