Managerial Economics and Strategy, 2/e

Questions

All exercises are available on MyEconLab; $\ast =answer$ [&\*|=|answer&] at the back of this book.

1. Consumer Preferences  

1. 1.1 Give as many reasons as you can why we believe that economists assume that the more-is-better property holds, and explain how these explanations relate to the results in the Mini-Case “You Can’t Have Too Much Money.”

2. *1.2 Arthur spends his income on bread and chocolate. He views chocolate as a good but is neutral about bread, in that he doesn’t care if he consumes it or not. Draw his indifference curve map.

3. 1.3 Show that an indifference curve

   1. Cannot be thick (cannot have positive thickness, rather than being just a line).

   2. Cannot bend backward (forming a “hook” at the end).

4. 1.4 Which of the following pairs ...