Microeconomics 2nd Edition by Douglas Bernheim

Exercise 2

What do you think the indifference curves shown in Figure 4.5 would look like for the type of person who prefers to drive a sports car What about the type of person who prefers to drive a subcompact
Figure 4.5 Indifference Curves for Horsepower and Fuel Economy. The typical new car buyer's preferences for horsepower and fuel economy correspond to the family of indifference curves shown in this figure. Consumers are willing to give up roughly 40 horsepower to increase fuel efficiency from 10 to 15 miles per gallon (compare points A and B), but they are willing to give up only 6 horsepower to increase fuel efficiency from 30 to 35 miles per gallon (compare points C and D).