Use the graph function to map this indifference curve

Reference no: EM131072527

An indifference curve is a relationship between two goods, X and Y, such that utility is constant. Consider the following indifference curve: Y = 12/X. Since this can also be written as 12 = XY then we can think of the value 12 as representing the utility level.

(a) In a spreadsheet enter the values 1. . . 24 in the X column, and in the adjoining Y column compute the value of Y corresponding to each value of X.

(b) Use the graph function to map this indifference curve.

(c) Compute the MRS where X increases from 3 to 4, and again where it increases from 15 to 16. [Hint: Since the MRS is the change in the amount of Y that compensates for a change in the amount of X, you need simply calculate the changes in Y corresponding to each of these changes in X.]

Reference no: EM131072527

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