Correct option is A
Correct Answer: (a) Indifference Curve
An indifference curve represents all combinations of two goods that provide the same level of satisfaction (utility) to a consumer. In other words, the consumer is "indifferent" between any points on the curve because they all yield the same utility.
Characteristics of an Indifference Curve:
- Downward Sloping: To maintain the same level of satisfaction, an increase in one good requires a decrease in the other.
- Convex to the Origin: This reflects the diminishing marginal rate of substitution (MRS), where the consumer is willing to give up less of one good to gain additional units of the other.
- No Intersection: Indifference curves cannot intersect because that would imply contradictory levels of utility at the intersection point.
The curve that joins all points representing bundles that are indifferent to the consumer is called an indifference curve.
Hence, the correct option is(a).
Other Option:
- Utility Curve: This is not a standard term in economics. Utility is often represented on an indifference curve but isn't a separate "curve" in this context.
- Consumer Curve: This term is not used in consumer theory.
- Marginal Curve: This could refer to marginal utility or cost curves, which are unrelated to indifference curves.
English
100 Questions
100 Marks
90 Mins
