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
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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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