What happens when indifference curves are bowed in toward the origin
A)A consumer is less willing to trade away any goods when his income decreases.
B)A consumer is more willing to trade away goods when his income increases.
C)A consumer is less willing to trade away goods that he has in abundance than the goods of which he has little.
D)A consumer is more willing to trade away goods that he has in abundance than the goods of which he has little.

Question

Quizplus · Accepted Answer

When indifference curves are bowed in toward the origin, it indicates diminishing marginal rates of substitution. This means a consumer is more willing to trade away goods that he has in abundance for goods of which he has little, reflecting a preference for balanced consumption.

What Happens When Indifference Curves Are Bowed in Toward the Origin