Consumer Demand

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The upper plot represents, in black, the combination of goods that a consumer can purchase with the budget constraint and, in grey, the consumer's indifference map. You can choose three possible utility functions: Cobb–Douglas, perfect complements, and perfect substitutes. The consumption choice is highlighted in red; it represents the combination of goods that the consumer decides to buy.

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The graph below shows, for each price, the amount purchased of good one, while holding the consumer's preferences, budget, and the other good price constant.

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Contributed by: Loreto Llorente (March 2011)
Open content licensed under CC BY-NC-SA


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