An indifference curve shows
A) utility maximizing levels of consumption.
B) preferred combinations of goods.
C) a diminishing marginal rate of substitution as more of both goods are consumed.
D) combinations of goods among which a person is indifferent.
E) an increasing marginal rate of substitution for a good as more of it is consumed.

Question

Quizplus · Accepted Answer

An indifference curve represents the different combinations of two goods that give an individual equal levels of utility or satisfaction. Thus, it shows the combinations of goods that a person is indifferent between, meaning that they provide the same level of utility.

An Indifference Curve Shows