Answer to Question #97913 in Macroeconomics for MEHWISH IBRAR

Question

how indifference curve graph effect by margin unity

Answer 1

An indifference curve connects points on a graph representing different quantities of two goods, point between which the consumer is indifferent. Therefore, any combinations of two products indicated by the curve will provide equal levels of utility, and the consumer has no preference for one combination or bundle of goods over a different combination on the same curve. Due to law of diminishing marginal utility, the indifference curve between two goods is convex to the origin. Having more goods, yields a higher level of utility and having less goods yields a lower level of utility.