Indifference Curves in Economics: What Do They Explain?
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SOLVED: As we saw in Figure 3.5, one way to show convexity of indifference curves is to show that for any two points (x1, y1) and (x2, y2) on an indifference curve that promises U=k, theutility associated with the point ((x1 x2)/(2), (y1 y2)/(2)) is at least as great as k . Use this approach to discuss the convexity of the indifference curves for the following three functions. Be sure to graph your results.a. U(x, y)=min (x, y)b. U(x, y)=max (x, y)c. U(x, y)=x y
SOLVED: As we saw in Figure 3.5, one way to show convexity of indi…
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