Economics 9708 · AS & A Level · Indifference curves and budget lines

Indifference curves and budget lines — practice question

(a)[25]

Explain how indifference curve theory predicts that a consumer will respond to changes in income and to changes in the price of a product in order to maximise satisfaction. Consider whether the use of 'nudge' theory (persuasion) conflicts with this theory of maximising satisfaction.

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