Indifference curves are downward sloping because
A)when some of one good is taken away the consumer must be compensated with more of the other.
B)higher prices mean less quantity demanded.
C)higher indifference curves mean higher utility.
D)Both A and B.

Question

Quizplus · Accepted Answer

Indifference curves are downward sloping because they represent combinations of two goods that provide the same level of satisfaction or utility. As the consumer must be compensated with more of one good if some of it is taken away to maintain the same level of satisfaction, the curve slopes downwards. Higher prices and quantity demanded are not directly related to the slope of indifference curves.

Indifference Curves Are Downward Sloping Because