1.
In this problem, you are asked to consider cases in which “more is
not better.” For each of the following scenarios, draw an
appropriate indifference curve map over different combinations of
Brussels sprouts (X) and broccoli (Y). Put Brussels sprouts (X) on
x-axis and broccoli (Y) on Y-axis. Draw 3 indifference curves for
each scenario and labeled, , and , from the lowest to the highest
utility level.
Hint: to determine the slope of the indifference curves, i.e.
whether the indifference curves are upward sloping or downward
sloping, start at an arbitrary point (on any indifference curve),
reduce the amount of x and ask whether y would have to increase or
decrease in order for the person to return to the same indifference
curve, i.e., to be indifferent between the original bundle and the
new bundle. You can refer to “four particular preferences” in the
slides but don’t expect the indifference curves to necessarily look
like those depicted in slides.
a) I like Brussels sprouts, but I don’t like broccoli
(Brussels sprouts are an economic good and broccoli is an economic
bad.)
b) I don’t like Brussels sprouts, and I don’t like
broccoli.
c) Brussels sprouts are useless for me, and I don’t like
broccoli.