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Indifference curves never intersect each other due to:
- a)Different levels of satisfaction
- b)Same levels of satisfaction
- c)Convex to origin
- d)Concave to origin
Correct answer is option 'A'. Can you explain this answer?
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Indifference curves never intersect each other due to:a)Different leve...
Indifference Curves cannot Intersect Each Other:
The indifference curves cannot intersect each other. It is because at the point of tangency, the higher curve will give as much as of the two commodities as is given by the lower indifference curve. This is absurd and impossible.
Diagram:
In the above diagram, two indifference curves are showing cutting each other at point B. The combinations represented by points B and F given equal satisfaction to the consumer because both lie on the same indifference curve IC2. Similarly the combinations shows by points B and E on indifference curve IC1 give equal satisfaction top the consumer.
If combination F is equal to combination B in terms of satisfaction and combination E is equal to combination B in satisfaction. It follows that the combination F will be equivalent to E in terms of satisfaction. This conclusion looks quite funny because combination F on IC2 contains more of good Y (wheat) than combination which gives more satisfaction to the consumer. We, therefore, conclude that indifference curves cannot cut each other.
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Indifference curves never intersect each other due to:a)Different leve...
Explanation:
Indifference curves represent the different combinations of two goods that provide the same level of satisfaction to a consumer. These curves are drawn on a graph with one good on the x-axis and the other good on the y-axis.
The following are the reasons why indifference curves never intersect each other:
Different levels of satisfaction: Each indifference curve represents a different level of satisfaction for the consumer. As we move away from the origin, the level of satisfaction increases. Therefore, it is not possible for two indifference curves to intersect because they represent different levels of satisfaction.
Convex to origin: Indifference curves are generally convex to the origin. This means that as we move away from the origin, the marginal rate of substitution (MRS) between the two goods changes. If two indifference curves intersected, it would mean that the MRS is the same at the point of intersection, which is not possible.
Concave to origin: If the indifference curves were concave to the origin, it would be possible for them to intersect. However, this is not the case, as most indifference curves are convex to the origin.
Therefore, the correct answer is option A, which states that indifference curves never intersect each other due to different levels of satisfaction.
Indifference curves represent the different combinations of two goods that provide the same level of satisfaction to a consumer. These curves are drawn on a graph with one good on the x-axis and the other good on the y-axis.
The following are the reasons why indifference curves never intersect each other:
Different levels of satisfaction: Each indifference curve represents a different level of satisfaction for the consumer. As we move away from the origin, the level of satisfaction increases. Therefore, it is not possible for two indifference curves to intersect because they represent different levels of satisfaction.
Convex to origin: Indifference curves are generally convex to the origin. This means that as we move away from the origin, the marginal rate of substitution (MRS) between the two goods changes. If two indifference curves intersected, it would mean that the MRS is the same at the point of intersection, which is not possible.
Concave to origin: If the indifference curves were concave to the origin, it would be possible for them to intersect. However, this is not the case, as most indifference curves are convex to the origin.
Therefore, the correct answer is option A, which states that indifference curves never intersect each other due to different levels of satisfaction.
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