A Basket of two commodity Which yield same level of Utility or Satisfaction to The Consumer  all combinations of two goods which yield the same level of satisfaction (utility) to the consumers.

1. INDIFFERENCE CURVE
P.Pandidurai M.A., M.phil.,
Assistant Professor
Prof.Dhanapalan College of Arts and Science

2. Meaning
 A Basket of two commodity Which yield
same level of Utility or Satisfaction to The
Consumer
 all combinations of two goods which yield
the same level of satisfaction (utility) to
the consumers.

3. Table: Indifference schedule
Table: Indifference schedule
Combination Mangoes Oranges Satisfaction
A 1 14 100
B 2 9 100
C 3 6 100
D 4 4 100
E 5 2.5 100

4. Diagram

5. Assumptions of indifference curve
Two commodities
It is assumed that the consumer has fixed amount of money, all of which is to
be spent only on two goods. It is also assumed that prices of both the
commodities are constant.
Ordinal utility
the theory assumes that a consumer can express utility in terms of rank.
Consumer can rank his/her preferences on the basis of satisfaction yielded from
each combination of goods

6. cont…
 Diminishing marginal rate of substitution
Marginal rate of substitution may be defined as the amount of a
commodity that a consumer is willing to trade off for another
commodity, as long as the second commodity provides same level of
utility as the first one.
 Rational consumers
According to this theory, a consumer always behaves in a rational
manner, i.e. a consumer always aims to maximize his total satisfaction or
total utility.

7. Properties of indifference curve
 Indifference curve slope downwards to right

8. Properties of indifference curve
 Indifference curve is convex to the origin

9. Indifference curve is convex to the origin

10. Indifference curve cannot intersect each
other

11. Higher indifference curve represents higher
level of satisfaction

13. Thank You