Question

An indifference curve may be defined as ________.

• A. the locus of the various combination of the two commodities which yield same level of satisfaction
• B. the locus of the various combination of two commodities which yield different levels of satisfaction
• C. the rate at which an individual will exchange successive unit of one commodity for another
• D. the locus of the various combination of more than two commodities which yield the same level of satisfaction

Answer 1

The correct option is A the locus of the various combination of the two commodities which yield same level of satisfaction

The indifference curve is a combination of two goods which would give the consumer the same amount of utility and satisfaction.Every point on the indifference curve would be a point where the consumer is indifferent. The indifference curve is downward sloping because for the consumer to purchase of more of some good, it has to give up some of another good.