A consumer is a rational individual who knows what is good and bad for him/her. So, he always tries to achieve the best to get maximum satisfaction. Thus, the consumer chooses the set of bundles as per his preference which is best for him. The consumer always prefers to move to a point on the highest possible indifference curve given on the budget set. The slope of the budget line is the rate at which the consumer is able to substitute one good for the other in the market.
The indifference curve is:
Convex
The correct answer is Convex.
An **indifference curve** represents different combinations of two goods that provide the same level of satisfaction to a consumer.
- Indifference curves are **convex to the origin** due to the **diminishing marginal rate of substitution (MRS)**.
- As a consumer moves down along the curve, they are willing to give up less of one good to get more of another.
- **(a) Positive** and **(b) Upward** are incorrect because indifference curves slope downward.
- **(c) Concave** would imply an increasing MRS, which contradicts consumer behavior.
Important Questions from Consumer’s Equilibrium
Match List-I with List-II:
List-I List-II (A) God's own country (I) Karnataka (B) Information Technology Industry (II) Punjab (C) Industrially advanced (III) Kerala (D) Agriculturally affluent (IV) Gujarat Choose the correct answer from the options given below:
According to Keynesian theory, the equilibrium level of income is achieved when:
Two commodities are perfect substitutes for the consumer and the indifference curve will be:
Suppose a consumer can afford to buy 8 units of good X and 10 units of good Y. She spends her entire income. The prices of two goods are ₹7 and ₹9 respectively. The consumer’s income is ₹______.
All the points on an indifference curve represent:
