A consumer has monotonic preferences. Bundles A (4 bananas, 10 mangoes) and B (6 bananas, 7 mangoes) lie on her indifference curve IC1. Bundle C (6 bananas, 9 mangoes) lies on IC2. Which of the following is correct?
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → She prefers C to A, so IC2 lies above IC1
C and B both have 6 bananas, but C has more mangoes, so C is preferred to B. A and B are on one curve and give equal satisfaction. So C is preferred to A.
Option (1) She is indifferent between A and C, so the two curves intersect — Incorrect. Two indifference curves never intersect.
Option (2) She prefers A to C, as A has more mangoes than C — Incorrect. A ranks equal to B, and C beats B.
Option (3) A and C cannot be ranked, as A has fewer bananas but more mangoes — Incorrect. They are ranked by comparing C with B.
Option (4) She prefers C to A, so IC2 lies above IC1 — Correct. The curve with preferred bundles lies above.
NCERT (2026-27): “Monotonic Preferences Consumer’s preferences are assumed to be such that between any two bundles (x1, x2) and (y1, y2), if (x1, x2) has more of at least one of the goods and no less of the other good compared to (y1, y2), then the consumer prefers (x1, x2) to (y1, y2). Preferences of this kind are called monotonic preferences. …” “Indifference Map … All points on an indifference curve represent bundles which are considered indifferent by the consumer. Monotonicity of preferences imply that between any two indifference curves, the bundles on the one which lies above are preferred to the bundles on the one which lies below.” |