Briefly explain the value of an indifference curve to the economist
2 answers:
An indifference curve is simply the curve that shows the combination of the two goods that will give the consumer an equal utility and satisfaction therefore the consumer will be indifferent.
Some of the characteristics of the indifference curve include:
1. It slopes slop downward to the right. This implies that the increase in the quantity of one commodity will lead to the reduction in the quantity of the other commodity.
2. The indifference curve can't intersect each other.
3. Indifference curve to the right simply means a higher level of satisfaction.
4. Indifference curves are always convex to the origin.
The importance of the indifference curve include:
• It can be used in measuring the standard of living.
• It can be used in knowing if a consumer is better off or not by comparing two periods of time and the income and price changes.
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