Define an indifference map. Explain why an indifference curve to the right shows higher utility level.

Define an indifference map. Explain why an indifference curve to the r

1.	Define an indifference map. Explain why an indifference curve to the right shows higher utility level.
Answer» Solution :An indifference CURVE is a graph showing combination of two goods that GIVE the CONSUMER equal satisfaction and utility. Each POINT on an indifference curve indicates that a consumer is indifferent between the two and all points give him the same utility. Higher Indifference Curve represents higher level of satisfaction, in other words, any combination that lies on a higher Indifference Curve i.a. away from origin represents a higher level of satisfaction.The underlying assumption here is the assumption of monotonic preference which represents that a consumer will PREFER a combination which contains more of at least one and no less of the other.