Question

The sloping down indifference curve indicates that _____________.

• A. there is inverse relationship between price and quantity demanded
• B. the amount of one commodity in the combination is increased, the amount of other commodity is reduced
• C. the amount of one commodity in the combination is increased, the amount of other commodity is also increased
• D. none of the above

Answer 1

The correct option is B the amount of one commodity in the combination is increased, the amount of other commodity is reduced

The indifference curve is a combination of two goods which would give the consumer the same amount of utility. 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.