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$Let$ the utility function defined to be :

$$U(x,y)=-x^2-y^2$$

I believe they are convex, the set which is preferred to a specific indifference curve is convex, but the answer sheet says that it is concave? What is the reason behind this? Or is the answer sheet just wrong?

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  • $\begingroup$ Here we are talking about convexity of the indifference curves $\endgroup$ – Xenidia Nov 2 '16 at 19:17
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The utility function is concave, but the preference that the function represents is convex. It seems you're confusing between the convexity of two different objects.

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