Question

$<b>$*️⃣ 50 Points Question *️⃣

Explain the condition of consumer equilibrium with the help of ordinal utility analysis.

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Answer 1

indifference curve IC 3 is beyond the capacity of the consumer with his given income hence it is outside of the priceline .

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Answer 2

Answer:

• The ordinal approach defines two conditions of consumer equilibrium: Necessary or First Order Condition and Supplementary or Second Order Condition. ... Indifference curve: The indifference curve shows the different combinations of two substitutes (goods) that yield the same level of satisfaction (utility) to the consumer.