A typical indifference curve is:
A)downward sloping and has a slope that is the negative of the marginal utility of the horizontal axis good divided by the marginal utility of the good measured on the vertical axis.
B)upward sloping and has a slope that is the negative of the marginal utility of the horizontal axis good divided by the marginal utility of the good measured on the vertical axis.
C)downward sloping and has a slope that is the negative of the total utility of the horizontal axis good divided by the total utility of the good measured on the vertical axis.
D)downward sloping and has a slope that is the total cost of the horizontal axis good divided by the total cost of the good measured on the vertical axis.

Question

Quizplus · Accepted Answer

This is the standard definition of an indifference curve - it shows the different combinations of two goods that give a consumer the same level of satisfaction or utility. The slope of the curve reflects the consumer's willingness to trade one good for the other, and is given by the ratio of the marginal utilities of the two goods. Since the slope is negative, the curve is downward sloping.

A Typical Indifference Curve Is