Explaining Julia's Situational Impatience at Her Endowment Point
At her endowment point A, where Julia has no consumption now and $100 in the future, her indifference curve is exceptionally steep. This steepness is a direct consequence of her situation; having zero present consumption makes her very impatient. This high degree of situational impatience means she is willing to sacrifice a substantial amount of her future consumption in exchange for even a small increase in her present consumption.
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Introduction to Microeconomics Course
The Economy 2.0 Microeconomics @ CORE Econ
Ch.9 Lenders and borrowers and differences in wealth - The Economy 2.0 Microeconomics @ CORE Econ
The Economy 2.0 Macroeconomics @ CORE Econ
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Learn After
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Figure 9.5: Julia's Indifference Curves and Situational Impatience