Slide 1 Indifference Curves An indifference curve shows a set of consumption bundles among which the individual is indifferent Quantity of X Quantity of Y X1X1 Y1Y1 Y2Y2…

Slide 1 Axioms of Rational Choice Completeness If A and B are any two situations, an individual can always specify exactly one of these possibilities: A is preferred to B…

Slide 1 Slide 2  level of happiness or satisfaction associated with alternative choices  a term referring to the satisfaction received by a consumer from consuming…

Slide 1 1 Chapter 3 PREFERENCES AND UTILITY Copyright ©2005 by South-Western, a division of Thomson Learning. All rights reserved. Slide 2 2 Axioms of Rational Choice Completeness…

Slide 1 Hypothesis: Workers of equal skill paid the same wage if workers are mobile Evidence: Wages differ One reason: Jobs differ in factors other than wage Good attributes…

Slide 1 INDIFFERENCE CURVES Slide 2 Warm-up Question  What do dating and marriage have to do with economics?  Scarcity  Choice  Utility maximization Slide 3 Economics…