Advertisements
Advertisements
Question
Define indifference map.
Solution
An indifference map represents a set of indifference curves which shows the various preferences of a consumer. Indifference curves on the indifference map do not intersect each other because consumers have various preferences with respect to their different levels of income.
RELATED QUESTIONS
Explain the conditions of consumer’s equilibrium using indifference curve analysis.
Explain the three properties of the indifference curves.
Define an indifference curve.
Why is an indifference curve negatively sloped? Explain.
If Marginal Rate of Substitution is constant throughout, the Indifference curve will be :(choose the correct alternative)
a. Parallel to the x-axis.
b. Downward sloping concave.
c. Downward sloping convex.
d. Downward sloping straight line.
If Marginal Rate of Substitution is increasing throughout, the Indifference Curve will be: (Choose the correct alternative)
a. Downward sloping convex
b. Downward sloping concave
c. Downward sloping straight line
d. Upward sloping convex
A consumer consumes only two goods. If the price of one of the goods falls, the indifference curve: (Choose the correct alternative)
a. Shifts upwards
b. Shifts downwards
c. Can shift both upwards or downwards
d. Does not shift
Explain why is an indifference curve is Convex.
Identify the correct pair of items from the following Columns I and II:
| Columns I | Columns II |
| (1) Demand Curve | (a) Downward sloping |
| (2) Indifference curve | (b) Upward rising |
| (3) Marginal Utility Curve | (c) L shaped curve |
| (4) Total Utility Curve | (d) Y shaped curve |
Which of these is not a property of indifference curve?
Identify the correct pair of items from the following Columns I and II:
| Column I | Column II |
| (1) Monotonic Preferences | (a) Consumer preferences are called monotonic when between any three bundles, consumers always choose a bundle having more of one good and no less of other goods. |
| (2) Indifference Set | (b) It is a set of those divisions of two goods that offer the consumer the same level of satisfaction so that the consumer is indifferent across any number of combinations in his indifference set. |
| (3) Indifference Curve | (c) It is a curve showing the different combinations of two goods, each combination offering the same level of satisfaction to the consumer. |
| (4) Indifference Map | (d) It refers to a set of indifference curves placed in different diagrams for the same type of goods. |
Indifference curve is:
Which of the following is an assumption for Indifference Curve Approach.
Which of the following statements are incorrect?
Will you defend or refute the case depicted in the following diagram? Provide a rationale in support of your view.
