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Question -

Suppose a consumer’s preferences are monotonic. What can you say about his/her preference ranking over the bundles (10, 10), (10, 9) and (9, 9)?



Answer -


S.No

Bundles

U1

I)

(10, 10)

3

II)

(10, 9)

2

III)

(9, 9)

1

As the consumer’s preferences are monotonic, more is better and he/she will prefer bundle I over the rest of the bundles. This means that bundle I will be assigned a higher utility number i.e., three (rank = three) out of the available three bundles.

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