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EconloMIC&
Put.ehlaiu hathi iadittexence CUKI mab ama uoget
diue hlhs iu deteuminng uilihuium
Ana, Cmaumen'a Equtltkuitn Afons_to a uituation_uhen d
CoNiumeu maripiter his makimum 8atisfaeron, with no
elenives
ufentiant Changeit when bhe ineame_at oongumer_AMCu
AuCeeo_acmmodly iR aiven.. The_poiut ot omaximum 8atTg
foction ia Gchieved Rkuolying iudiPPexence uwuu ma
amou luuolget lineaelher

nditexenee Map fu iudaffenence _oue iudtcatesdiPPexent

Cambiaahiong ot thuoCommadthieg_whtch yield ene equal
&ahotachton_tcme umer. Tn GHdlan t yteld. higher dual a
gahakacharns, 0onaumer make wl o aitfexmiudiftexence
UKANh Thu difteuunt iudtfexence_euuu _oX o fomey P
oli Fteuence _uu iknoun as Indi PËerence Ma,_aa ghoun.

On. Tnolitfeuence Hap, the

highest iudiPtexence euLeg
give maximum gahisfachou,
hs8hon in diynem A, Tey -Tu
gtoe the maximum_&ahsfnchton
thau ICg+C giue more thou
TC, Guol LC2 qiemore lhan
rCHence, TC aLes the AInditfexence Ma
deast gahetachou t comsumer
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U O P a g e N o . * * * * * * * * * * * * * * * * * * * * * * *

*Budset dine ; Budget dine isa abhical suhlentahon o

huaahased
cll o8STble_combínah'emg_of tuo aads shieh oanbethat he
wlth gue incomeo the cm8umer amdl hsuaea, &uch
Cost oP cach o _h ese commbiuahong eguol t Bhe mmey
mcome a meumer. Supbase a em8umer has money mgo
o R eo auol hce af_aommodihy X i u_anolY ie 8 each-
Wrih fhese he diPPeuent Ombinahmg_hata Qm&umer a
8-
get o thtle lado aods axe ghoun ia Takle 8 and Fia
Cammodiky
X
Gmmodlrty Combiuahion|
5 A

3 8udset dine
2
L 8 E
F
Table B Fi 8
In Fis8, Ca dee_hatall_Qmmbinahiomg_on budet diue-
meyincome _ig tully apeut. The AHea unglexu budlaet dine
chows Cmbinahmg îu wluoh mmey ncme i undlexspent as
ghouin potut C uo he axea_abae budsck dine shawg
unatainakle_emmbiaahiomg_al Shouuoiut c

Tpo ConAITiOMS FOR ConsuMeR'3 EQUILLBeIUM

.Pauioekiue ou_Budget dius 8hould be tougent t
TiA elR euALe CuA This means thak Maxaiual aate a
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Dub&itituhou Fex of gabdy fory (MRSxY) egual th he

lobe a fufce diue f
Py
LndifPeeuce Cusu mu&t_be conuex t he augiuat t h e
hantof_Eouiltbsutum. Thiwefore MaHainal Ra-e ot &ub&hHina
Cnhinues t Pall, go_that egutlibsutum 0an beeakabl a hedu-.

dotae
us un oleuttand both the amdthiona t 8keey 0m8umers
tquidibuum palut loth_the ule o fudifPexence map ancl

4oodY

-Tt

odx
Fg
Exlanation;
LYIn the A bave oliaguam, AB is a budaet diue anol TC
Iudilfeuence Map ie. IC,,IC TC)
aYFirst Conditton; AATC , IC axe tanget t the Ruclget
ltne on_Point P aud which aives game devel afP
gatistachion
but TG Aves desser Kahisfachiola al Combaxeat TC aud E,.
auol Cmsumer iueluced TiGchteve hgher Sahitfuchion
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80 he ia_înduced t beat TC T. Hence, this po ut

P aual G is not a Oonsumer equilibaum.
aE TGz-, Cansumer_wtllaek maximum SahisPachiaM as eambxeal
Gncl rC but siL th balut cannot bea Congumer
quiibauum paiuk heCaule this pailuk is_autE obudae due,-
C.an&umer eon't_dAeach_his boint.
M AE T, Condum.er utll get maxtmum Sahistachion a
Gompaxeol t TC becauue higher the IC dhotog hiaher
lwel o 8ahofachon amol TC, is tangent ti budget dine
anol Cmuex euiain 8opofnt E uL he Q Gongumex
euilibuum pofnt
ConNCIuSION At pafut E,the buelaet dine fo tangehE t
the uelifPeuence T GMol this boiiut is eonuex t aHIM
Heuee, this potut RahkPtes holh the Cm.dthong TheuefbrTe
tE &afol t beCm8umex'R Equtlibshtm_patut et thich
MRS Cry)= t A this atnk _a OmåumerhuAchade

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