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INDIFFERENCE CURVE ANALYSIS Dr. Aruni Kumar 24/04/2020 Stay at Home Stay Safe 1 DEFINITION: IC An Indifference curve (IC) is the locus of all those combination of two goods which give the same level of satisfaction to the consumer. Thus consumer is indifferent towards all the combinations lying on the same indifference curve. In other words, consumer gives equal preference to all such combinations. 24/04/2020 Stay at Home Stay Safe 2 INDIFFERENCE CURVES 24 22 A(1, 22) 20 INDIFFERENCE SCHEDULE 18 ) (Table Showing Different 4 16 ,1 Combinations giving Equal (2 14 B ) Satisfaction) 10 , 12 (3 ) Combination Apples Oranges C 8 10 , ) 4 7 A 1 22 ( , s D 5 8 ( e E B 2 14 g 6 n a C 3 10 4 r O D 4 8 2 Apples 0 24/04/2020 Stay at Home Stay Safe 3 E 5 7 1 2 3 4 5 6 INDIFFERENCE CURVES 24 22 A(1, 22) 20 INDIFFERENCE SCHEDULE 18 16 4) Combination Apples Oranges (2,1 14 B ) 0 , 1 A 1 22 12 (3 ) C , 8 B 2 14 10 4 ) ( , 7 8 D 5 C 3 10 s E( e 6 D 4 8 g n 4 IC a 1 E 5 7 r O 2 Apples 0 24/04/2020 Stay at Home Stay Safe 4 1 2 3 4 5
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