What does an indifference map show?
An Indifference Map is the graphical representation of two or more indifference curves showing the several combinations of different quantities of commodities, which consumer consumes, given his income and the market price of goods and services.
What is indifference curve with diagram?
Definition: An indifference curve is a graph showing combination of two goods that give the consumer equal satisfaction and utility. The graph shows a combination of two goods that the consumer consumes. The above diagram shows the U indifference curve showing bundles of goods A and B.
What are indifference and indifference maps?
A graph of indifference curves for several utility levels of an individual consumer is called an indifference map. Points yielding different utility levels are each associated with distinct indifference curves and these indifference curves on the indifference map are like contour lines on a topographical graph.
What is difference between indifference curve and indifference map?
It refers to a set of indifference curves corresponding to different income levels of the consumer. In an indifference map, indifference curves are parallel and a higher indifference curve represents a higher level of satisfaction.
What is slope of IC?
The slope of the indifference curve is known as the MRS. The MRS is the rate at which the consumer is willing to give up one good for another.
Why are indifference curves concave?
Indifference curves can be straight lines if a slope is constant, resulting in an indifference curve represented by a downward-sloping straight line. If the marginal rate of substitution is increasing, the indifference curve will be concave to the origin.
Is indifference curve convex or concave?
Along the curve, the consumer has an equal preference for the combinations of goods shown—i.e. is indifferent about any combination of goods on the curve. Typically, indifference curves are shown convex to the origin, and no two indifference curves ever intersect.