Asha says she is indifferent between the bundles (5, 6) and (6, 6), where the first number is bananas and the second is mangoes. What can be said about her preferences?
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → They are not monotonic, as (6, 6) has more bananas and no fewer mangoes
(6, 6) has one more banana and the same mangoes as (5, 6), so monotonic preferences would rank it higher.
Option (1) They are monotonic, as both bundles have the same mangoes — Incorrect. The extra banana should make (6, 6) preferred.
Option (2) They are not monotonic, as (6, 6) has more bananas and no fewer mangoes — Correct. Being indifferent here breaks monotonicity.
Option (3) They show diminishing marginal rate of substitution — Incorrect. MRS is about giving up one good for another; here she gives up nothing.
Option (4) They show that bananas and mangoes are perfect substitutes for her — Incorrect. Perfect substitutes trade one for another; here mangoes do not change at all.
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. Thus, a consumer’s preferences are monotonic if and only if between any two bundles, the consumer prefers the bundle which has more of at least one of the goods and no less of the other good as compared to the other bundle.” |