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indifference curve

Economics Asked on July 31, 2021

Suppose my preferences are such that I like more of both goods, but only up to a
point. After I have 5 units of both goods, that’s as good as it gets, and I’m indifferent if I
get more.
how do u draw the indifference curves? it seems that any bundle with more than five units of both goods are the same, so any line in that area is useless

2 Answers

The area from $(0, 0)$ to $(5, 5)$ would be just like any other two-good indifference curve. Then since the area ${(x, y): x geq 5, y geq 5}$ has the same utility, they're all on the same "indifference curve" (so that's more like an "indifference area").

Not sure what the indifference curves would look like, say, at $(80, 2)$ though since you didn't specify if that's better or worse than $(5, 5)$.

Correct answer by Art on July 31, 2021

This is an example of a satiation point or bliss point. Basically you want a particular point and getting further away from this point decreases your utility. The indifference curves look like concentric circles around a specific point, in your case (5,5) is the bliss point.

Answered by Angela Shoulders on July 31, 2021

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