I'm a bit mad...

Tjola hoppsan... Ekonomi är ganska kul faktiskt... jag har en wordplay åt er alla! Why are goods called goods? Because it is something we want to consume it is something good.. Jag visste inte att ordet kom därifrån liksom :O Fortsatt så finns det bads och neutrals... vilket är saker man INTE vill ha tillexempel som avgaserna när man köper en bil... du skulle ju inte köpa avgaserna baral iksom? Och neutral är saker som man helt enkelt inte bryr sig om man har eller inte... totalt likgiltig! :P

MEN det kommer tider då jga HATAR ekonomi, som idag eller jag har inte ämnet men idag så typ sa jag emot min tutor, och ursäkta men jag vet itne... jag tycker jag har rätt... och han tyckte ajg hade fel så jag får väll skriva till professor och fråga tänkte jag så det gjorde jag också.

Hi prof. Wooton,

I had my tutorial today and i couldn't come to an agreement with my tutor about question 3.
It reads as follows "A consumer with convex preferences who is indifferent between the bundles (5 , 1) and (11 , 3) will like bundle (8 , 2) at least as well as either of the first two bundles" True or false?

I argued that this statement is true, while my tutor argued for it being false. I would like you to clarify the situation as we couldn't reach a consensus in the question as i didn't feel that i got a sufficient answer from my tutor.

I argue as Varian writes "we are going to assume that averages are preferred to extremes. That is, if we take two bundles of goods (x1, x2) and (y1, y2) on the same indifference curve and take a weighted average of the two bundles [...] then the average bundle will be at least as good as or strictly preferred to each of the two extremes" [p.46 seventh edition.] And thus it will be true as it is "at least as good as" or strictly preferred.

My tutor instead argues that it is wrong and false because of the mentioning of "convex preferences". He argues that since we know that it is convex we know that the average is strictly preferred to the extremes the statement is false.

To start off I would like to claim that you yourself stated something along the lines with "perfect substitutes is the weakest convex preference curve". And therefore i would say that it is not necessary so that we know that an average is strictly preferred.

Finally my second counterargument would be that IF a bundle (x) is strictly preferred to another (y) mustn't it also be liked "at least as well as" this comparative bundle (y)?

I hope you can shed some light upon this situation as I'm quite dissatisfied about how the tutorial went along, unless it turns out I'm in fact out in the blue then I'll accept any good answer you can give me.

Thank you
/ Sebastian

Aja anyhow undrar vad svaret blir! :P Have a nice day i love you all! :)

/sebs

The choice of letting be is sometimes harder than your will to interfere.