Refer to the information provided in Figure 6.13 below to answer the question(s) that follow. Figure 6.13
-Refer to Figure 6.13. Assume Megan has two products available, pizza and hamburgers. Megan must be compensated with more pizzas as she gives up more hamburgers. The curve in Panel ________ represents her indifference curve.

Question

Refer to the information provided in Figure 6.13 below to answer the question(s) that follow.   Figure 6.13
-Refer to Figure 6.13. Assume Megan has two products available, pizza and hamburgers. Megan must be compensated with more pizzas as she gives up more hamburgers. The curve in Panel ________ represents her indifference curve.

Quizplus · Accepted Answer

The shape of the curve indicates that Megan has a diminishing marginal rate of substitution. The curve in Panel B is bowed inward toward the origin, indicating that she is willing to give up more and more hamburgers as she gets more pizzas. This suggests that she prefers variety in her consumption, rather than choosing only one of the two products. At any given point on the curve, she is indifferent between the two products. Therefore, the curve in Panel B represents her indifference curve.

Refer to the Information Provided in Figure 6