Indifference curves
A)are non-intersecting.
B)are contour lines of a utility function.
C)are negatively sloped.
D)all of these are correct.

Question

Quizplus · Accepted Answer

Indifference curves are non-intersecting because each curve represents a different level of utility, and it is not possible to have two different levels of utility at the same time. Indifference curves are contour lines of a utility function because they represent all possible combinations of two goods that give the same level of utility to the consumer. Finally, indifference curves are negatively sloped because the Law of Diminishing Marginal Utility states that as a consumer consumes more of a good, the marginal utility from each additional unit of consumption decreases, leading to a negative slope of the indifference curve.

Indifference Curves