Q.State the main properties of Indifference Curves.

Indifference curves have four standard properties that follow directly from the assumption of ranked, consistent preferences.

(1) Indifference curves slope downward from left to right. To keep total satisfaction unchanged along the curve, gaining more of one good must be compensated by giving up some of the other good — if both quantities could increase together while satisfaction stayed the same, the two goods would not genuinely both be desirable to the consumer.

(2) Indifference curves are convex to the origin. This follows directly from the Law of Diminishing Marginal Rate of Substitution: as a consumer already holds more of good X, he is willing to give up progressively SMALLER amounts of Y for each additional unit of X, which makes the curve flatter as it moves rightward — the defining shape of convexity.

(3) A higher indifference curve represents a higher level of satisfaction. Any point on a curve farther from the origin contains more of at least one good (often both) than a point on a curve closer to the origin, and more of a good is always preferred to less (the assumption of non-satiation), so the farther curve must represent greater total satisfaction. …

Describing indifference curves as straight lines or as concave to the origin is a frequent error — a straight line would imply a CONSTANT (not diminishing) rate of substitution between the two goods, which is the special cas …