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Figure 4.19 Two Consumers’ Optimal Choices
Although they have the same budget constraint, Jack and Meg have different relative preferences and, therefore, different optimal consumption bundles. Because Jack likes gum relative to iTunes downloads, his indifference curve (UJ) is flat and he consumes much more gum than iTunes at his optimal consumption bundle at point J. Meg’s indifference curve (UM) is much steeper and reflects her relative preference for iTunes downloads over gum; her utility-maximizing bundle is shown at point M. Although their consumption bundles are different, the MRS is the same at these points.