Understanding Indifference Curve Analysis

CompactMaroon7142 avatar

Start Quiz

Study Flashcards

9 Questions

The slope of an indifference curve is:

The marginal rate of substitution

In indifference curve analysis, a consumer is assumed to be:

Rational and always maximizing utility

An indifference curve represents:

Combinations of goods that give the same level of satisfaction

Which of the following is NOT an assumption of indifference curve analysis?

Perfect competition in the market

What happens to the slope of an indifference curve as we move along it?

It becomes flatter

Which property is NOT associated with indifference curves?

Represent diminishing returns to scale

According to indifference curve analysis, which of the following is a valid assumption?

Preference is transitive and complete

What happens to the shape of an indifference curve if the consumer's preferences change?

It remains constant

Which property is NOT associated with indifference curves?

They are straight lines

Test your knowledge of indifference curve analysis, where consumers are assumed to have indifference curves representing their preferences, and the slope of the curve indicates the consumer's marginal rate of substitution.

Make Your Own Quizzes and Flashcards

Convert your notes into interactive study material.

Get started for free
Use Quizgecko on...