2.Assume that two baskets and lie on the same indifference curve.Assume that basket contains more of good than basket but less of good than basket .As the consumer moves down and to the right (from basket to basket ) along his indifference curve,total utility
A) increases.
B) remains constant.
C) decreases.
D) is ambiguous.

Question

Quizplus · Accepted Answer

Since both baskets lie on the same indifference curve, they provide the same level of utility to the consumer. As the consumer moves from one basket to the other along the indifference curve, the quantity of one good increases while the quantity of the other good decreases, but the overall level of utility remains constant. Therefore, the total utility remains constant as the consumer moves down and to the right along the indifference curve.

2Assume That Two Baskets and Lie on the Same Indifference