Lisa consumes bus rides, good X, and other goods, good Y. Because of the nonsatiation assumption, Lisa must like bundle A : (x = 5, y = 1,000) better than bundle B = (x = 6, y = 800).

Question

Lisa consumes bus rides, good X, and other goods, good Y.  Because of the nonsatiation assumption, Lisa must like bundle A : (x = 5, y = 1,000) better than bundle B = (x = 6, y = 800).

BlackTom AI · Accepted Answer

The question presents two bundles: A = (x = 5, y = 1000) and B = (x = 6, y = 800), and asks whether Lisa must like A better than B due to the nonsatiation assumption.

Option 1 (True): This would assert that A is preferred to B purely based on the nonsatiation idea. However, nonsatiation means more of at least one good is preferred to less, holding the other good fixed. It does not dictate a strict ranking when one bundle has more of one good but less of another. Since A has less x (5 vs 6) but more y (1000 vs 800), the overall preference depends on Lisa’s trade-off between x and y. Therefore, the claim that A must be preferred is not guaranteed by nonsatiation alone.

Option 2 (False): This option correctly captures the limitation described above. Nonsatiation does not imply that any particular trade-off between two goods is always preferred; it only ensures that more of at least one good (and not less of both) is preferred in some sense, and even that depends on the rest of the consumer’s preferences and the marginal rates of substitution between x and y. Since A has less of x but more of y than B, there is no reason to conclude A is unequivocally preferred. The true statement would recognize that the preference between A and B is indeterminate from nonsatiation alone and would require the entire indifference curves or utility function to determine.

In sum, the claim that Lisa must like A better than B cannot be asserted from nonsatiation alone, because the two bundles involve a trade-off between two goods and nonsatiation does not fix that trade-off. The correct interpretation is that the statement is not necessarily true, given only nonsatiation.

SIPAIA6400_001-002_2025_3 - Microeconomic Analysis for International and Public Affairs Problem Set 4, Individual Portion

Lisa consumes bus rides, good X, and other goods, good Y. Because of the nonsatiation assumption, Lisa must like bundle A : (x = 5, y = 1,000) better than bundle B = (x = 6, y = 800).

查看解析

登录即可查看完整答案

类似问题

Which of the following is NOT a property that consumers’ preferences might have?

What must be true about the relationship between E and F?

What must be true about the relationship between B and D?

What must be true about the relationship between A and F?

What must be true about the relationship between C and E?

Suppose u is a utility function that represents a consumer's preferences. Then u must be complete and transitive.

Choose the term that matches this definition:A consumer is able to compare and rank all possible baskets. If you give someone a choice between any two possible sets of options, they will be able to rank them.

Randy likes baseball more than football, football more than basketball, and basketball more than baseball. Which assumption about consumer preferences does this violate? I. Completeness II. Monotonicity III. Transitivity IV. Diminishing marginal utility

更多留学生实用工具

考试浏览器助手

风格化写作助手

论文查重助手

文献引用助手

课堂转译助手

课堂笔记助手

Quiz搜索助手

学校历年真题

智能刷题助手

智能匹配练习

希望你的学习变得更简单