Indifference Curve
Definition: An indifference curve is a graph showing combination of two goods that give the consumer equal satisfaction and utility.
Example: Cost of a pant is 100/- and shirt is 100/- each. If you have 500/- you can buy total five shirts or pants but you have to purchase both. Different combinations are 4 shirts and 1 pant, 3 shirts and 2 pants, 2 shirts and 3 pants, 1 shirt and 4 pants. These four combinations of shirts and pants will give the customer same amount of satisfaction.
These different combinations can be represented on the graph using a curve called indifference curve.
Features of Indifference Curve:
1. Indifference Curves are downward sloping.
2. Highest indifference curves are preferred to lower once.
3. These curves never intersect with each other.
4. These curves are convex to the origin.
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