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Given below an indifference curve1. State the meaning of an indifference curve. 2. Identify the points A, B, C and D on the 1C. |
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Answer» 1. An indifference curve shows different bundles that give the consumer the same level of satisfaction. In other words, an indifference curve joins all points representing bundles which are considered indifferent by the consumer. 2. Points A and B are on the indifference curve indicating the same level of satisfaction. Point C lies above the indifference curve representing the preferred bundles. Point D lies below the indifference curve showing the inferior bundles. |
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