Economics
Economics
5th Edition
ISBN: 9781319066604
Author: Paul Krugman, Robin Wells
Publisher: Worth Publishers
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Chapter 10.A, Problem 3P
To determine

Concept Introduction:

Indifference Curve: It is a line that shows all the consumption bundles that provides the same amount of total utility for an individual.

The different properties of indifference curves are:

  • The two indifference curve lines never intersect each other.
  • The farther the indifference curve is from the origin the more utility it has.
  • Indifference Curve slopes downwards because more is better.
  • Indifference Curve has a convex shape because of the diminishing marginal utility which states that the marginal utility of an additional unit decreases.

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