Alvin's preferences for good X and good Y are shown in the diagram below.
Figure 3.1.6
-Refer to Figure 3.1.6. Which assumption concerning preferences do Alvin's indifference curves violate?
A) Diminishing marginal rates of substitution
B) Transitivity of preferences
C) More is preferred to less
D) Completeness
E) both A and C

Question

Alvin's preferences for good X and good Y are shown in the diagram below.
  Figure 3.1.6
-Refer to Figure 3.1.6. Which assumption concerning preferences do Alvin's indifference curves violate?
A) Diminishing marginal rates of substitution 
B) Transitivity of preferences 
C) More is preferred to less 
D) Completeness 
E) both A and C

Quizplus · Accepted Answer

Alvin's indifference curves violate both the assumption of diminishing marginal rates of substitution (as the curves are bowed inward) and the assumption that more is preferred to less (as some of the lower indifference curves represent higher levels of both goods). Therefore, the best choice is E, both A and C.

Alvin's Preferences for Good X and Good Y Are Shown