Indifference curve analysis illustrates various combinations of commodities that yield equal satisfaction to consumers, depicted through downward-sloping curves that are convex to the origin. Key features include the non-intersections of curves, higher curves representing greater satisfaction, and the curves never touching the axes. Additionally, indifference curves may not be parallel, and incorrect configurations include curves parallel to the axes or with a positive slope, which would misrepresent consumer satisfaction.

1. INDIFFERENCE
CURVE
ANALYSIS

2. What Is Indifference Curve ??
An Indifference Curve is a Curve
which shows different combination
of commodities providing equal
satisfaction to the consumer.

3. IC’s schedule and diagram
EACH POINT (A,B,C,D) ON IC INDICATES THAT A
CONSUMER IS INDIFFERENT BETWEEN THE X &Y
COMMODITIES AND ALL POINTS GAVE HIM SAME

4. Indifference Map
INDIFFERENCE
MAP IS THAT
GRAPHWHICH
REPRESENTS A
GROUP OF
INDIFFERENCE
CURVE, AND EACH
INDIFFERENCE

5. Feature of Indifference Curve
THERE ARE 6 FEATURES OF IC:
1. An Indifference Curve slopes
downward from left to right
WHEN A CONSUMERWANTS TO
HAVE MORE OF A COMMODITY,
HE/SHE WILL HAVE TO GIVE UP
SOME OF THE OTHER
COMMODITY,GIVEN THAT THE
CONSUMER REMAINS ON THE SAME
LEVEL OF UTILITY AT THE
CONSTANT INCOME.
AS A RESULT, THE INDIFFERENCE
CURVE SLOPS DOWNWARD FROM

6. 2. Indifference Curve Should be convex to
the point of Origin
THIS IS AN IMPORTANT PROPERTY
OF INDIFFERENCE CURVE.THEY
ARE CONVEX TO THE ORIGIN.THIS
IS EQUIVALENT TO SAYING THAT AS
THE CONSUMER SUBSTITUTES ITEM
A FOR ITEM B ,THE MARGINAL
RATE OF SUBSTITUTION DIMINSHES
OF A FOR B ALONG AN
INDIFFERENCE CURVE.

7. 3.Two Indifference Curve never
touch each other
EACH INDIFFERENCE CURVE
REPRESENT THE DIFFERENT LEVEL
OF SATISFACTION SO THEY DON’T
INTERSECT EACH OTHER.
HERE A & B POINT SHOW THE SAME
LEVEL OF SATISFACTION AND ALSO
A&C POINT SHOW SAME LEVEL OF
SATISFACTION SO A=B AND A= C
THEREFORE B=CWHICH IS NOT
POSSIBLE.

8. 4.Higher Indifference Curve
INDICATES higher satisfaction
HIGHER INDIFFERENCE CURVE
SHOWS HIGHER LEVEL OF
SATISFACTION BECAUSE IT TAKES
MORE QUANTITY OF GOODS AS
COMPARED TO LOWER
INDIFFERENCE CURVE.
HERE Q POINT HAVE MORE
GOODS AS COMPAERED TO POINT
S ON LOWER INDIFFERENCE
CURVE.

9. 5.Indifference Curve neither
touches x-axis not y-AXIS
INDIFFERENCE CURVE IS
RELATED WITH THE
COMBINATION OF TWO
COMMODITIES WHICH MEANS
ONE COMMODITY GIVES EQUAL
SATISFACTION.
HERE IC2 HAVE OL UNITS OF
GOODYWHILE ZERO UNITS OF
GOOD X SO INDIFFERENCE
CURVE NEVER TOUCHES ANY
AXIS.

10. 6.Indifferce Curve need not be
parallel to EACH other
TWO INDIFFERENCE
CURVE MAY OR MAY NOT
BE PARALLEL TO EACH
OTHER . IT All DEPENDS
UPON MARGINAL RATE OF
SUBSTITUTION OF TWO
CURVES.
HERE BOTH IC HAVE
DIFFERENT MARGINAL
RATE OF SUBSTITUTION .

11. ANOTHER SHAPES OF
INDIFFERENCE CURVE
1. AN INDIFFERENCE CURVE IS PARALLEL
TO X AXIS
IF AN INDIFFERENCE CURVE
PARALLEL TO OX AXIS THEN IT GIVES
WRONG EXPLANATION OF THE
THEORY .
HERE CONSUMER GETS MORE
SATISFACTION AT POINT B THAN A
BECAUSE ON POINT B CONSUMER
GETS MORE GOODS THAN POINT A .

12. 2. AN INDIFFERENCE CURVE IS PARALLEL
TOY AXIS
IF AN CURVE PARALLEL TO OY
AXIS THEN ITWILL ALSO GIVE
WRONG EXPLANATION OF THE
THEORY.
HERE CONSUMER GETS MORE
SATISFACTION AT POINT A THAN
B. ON POINT A CONSUMER GETS
MORE GOODS SO HE GETS MORE
SATISFACTION.

13. 3. An Indifference Curve has positive slope
THIS TYPE OF INDIFFERENCE
CURVE ALSO GIVESWRONG
EXPLANATION OF THE THEORY
.
HERE CONSUMER GETS MORE
SATISFACTION AT POINT A
THAN POINT B .IT IS CLEARLY
SHOWN THAT ON POINT A
CONSUMER GETS MORE
COMMODITIES WHICH GIVES
HIM MORE SATISFACTION.

14. Thank
You