An indifference curve is a graphical representation of different combinations of two goods that give a consumer the same level of satisfaction or utility. It shows the various combinations of goods that are equally preferred by a consumer, implying that the consumer is indifferent between each combination.
The curve typically has a downward-sloping convex shape, indicating that as the consumer consumes more of one good, they are willing to give up some of the other good to maintain the same level of satisfaction. This reflects the concept of diminishing marginal utility, where the satisfaction derived from consuming additional units of a good decreases as more units are consumed.
Indifference curves are essential in analyzing consumer preferences and choices. They help in understanding how consumers make trade-offs between goods, as well as determining their preferences and willingness to substitute between different goods.
What is the indifference curve
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