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Topic: Indifference curve

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	Indifference curve - Wikipedia, the free encyclopedia
		An indifference curve is a graph showing combinations of goods for which a consumer is indifferent, that is, it has no preference for one combination versus another, as they render the same level of satisfaction for the consumer.
		Indifference curves are a device to represent preferences and are used in choice theory.
		The curves are convex, which is a consequence of the assumption that as consumers have less and less of one good, they require more of the other good to compensate (corresponding to the law of diminishing marginal utility).
	en.wikipedia.org /wiki/Indifference_curve (1166 words)

	Boyes/Melvin Chapter 21a Overview and Strategies
		Indifference curves show the various combinations of two goods that yield identical utility and to which the consumer is indifferent.
		The shape of indifference curves: Indifference curves slope downward from left to right, indicating that to maintain constant utility, as less of one good is consumed, more of another must be.
		The slope of indifference curves: The rate at which a consumer is willing to exchange one good for another to maintain constant utility is determined by consumer preference.
	college.hmco.com /economics/boyes_melvin/shared/faculty/chov21a.html (599 words)

	The demand side of trade (Site not responding. Last check: 2007-10-21)
		Thus, the indifference curve is bowed in or convex to the diagram's origin.
		The highest indifference curve attainable is the one that is just tangent to the transformation schedule, and this tangency point indicates the optimal combination of wheat and autos for that nation to produce and consume.
		The slope of the tangent to the indifference curve and the transformation schedule at this point reflects the marginal rate of substitution between wheat and autos at this point of maximum satisfaction.
	www.eco.utexas.edu /graduate/Konstantinova/i3_IntEqm.htm (2481 words)

	Indifference Curve Analysis [Virtual Learning Arcade]
		The general rule is that indifference curves further too the right (I4 and I5) show combinations of the two goods that yield a higher utility, while curves to the left (I2 and I1) show combinations that yield lower levels of utility.
		The first stage is to impose the indifference curve and the budget line to identify the consumption point between two goods that a rational consumer with a given budget would purchase.
		Indifference analysis can be used to analyse how a consumer would change the combination of two goods for a given change in their income or the price of the good.
	www.bized.ac.uk /virtual/vla/theories/indifference_curve.htm (1205 words)

	Indifference curve (Site not responding. Last check: 2007-10-21)
		In microeconomics, an indifference curve is a graph showing combinations of two goods to which an economic agent (such as a consumer or firm) is indifferent, that is, it has no preference for one over the other.
		For example, if a consumer was equally satisfied with 1 apple and 4 bananas, 2 apples and two bananas, or 5 apples and 1 banana, these combinations would all lie on the same indifference curve.
		The theory of indifference curves was developed by Vilfredo Pareto and others in the first part of the 20th century.
	www.enlightenweb.net /i/in/indifference_curve.html (1066 words)

	Consumer theory - Wikipedia, the free encyclopedia
		Using indifference curves and an assumption of constant prices and a fixed income in a two good world will give the following diagram.
		The consumer will choose the indifference curve with the highest utility that is within the budget constraint.
		Depending on the indifference curves the amount of a good bought can either increase, decrease or stay the same when income increases.
	en.wikipedia.org /wiki/Consumer_theory (698 words)

	[No title] (Site not responding. Last check: 2007-10-21)
		An indifference curve further from the origin is preferred to one closer to the origin i.
		Indifference curves show how much of on good the individual is willing to give up to get an additional unit of another b.
		Indifference Curve - shows combinations of goods and leisure among which the individual is indifferent b.
	econ.bu.edu /lang/ec101/oct11.txt (829 words)

	Curve sketching
		The level curve of f for the value 1 is the set of all pairs (x, y) such that xy = 1, or, equivalently, y = 1/x.
		1, 2, 3, or 10, 20, 30) then curves that are close indicate regions in which the rate of change of the function is large, whereas curves that are far apart indicate regions in which the rate of change of the function is small.
		The level curves corresponding to heights of 10 and 30 are thick, whereas those corresponding to heights of 0 and 20 are not.
	www.chass.utoronto.ca /~osborne/MathTutorial/SKE.HTM (1127 words)

	SparkNotes: Demand: Utility
		After that, it is simply a matter of finding the outermost indifference curve that is tangent to (just barely touches) her budget constraint, and use this tangent point as her optimal combination of wine and glasses.
		In this case, it is the second indifference curve that optimizes her utility given her budget.
		If it were an indifference curve that crosses her budget constraint, such as the first indifference curve, then we can see that the two points of intersection don't make her as happy as the single tangent point in the previous graph.
	www.sparknotes.com /economics/micro/supplydemand/demand/section3.rhtml (1788 words)

	David Friedman, Price Theory: Chapter 3: The Consumer: Choice and Indifference Curves
		Indifference curves and the like are useful as analytical tools; it is a serious error to think of them as things we actually expect to go out and measure.
		Its curvature, the fact that the slope of the indifference curves becomes shallower (i.e., less negative) as you move right or down on the diagram and steeper as you move left or up, is suggested by the principle of declining marginal utility but is not, strictly speaking, implied by it.
		The slope of the indifference curve is -([[partialdiff]] u/[[partialdiff]] x)/([[partialdiff]] u/[[partialdiff]] y), so the slope of the indifference curve through B is shallower than the slope of the indifference curve through A--unless [[partialdiff]] u/[[partialdiff]] y decreases even faster than [[partialdiff]] u/[[partialdiff]] x as x increases.
	www.daviddfriedman.com /Academic/Price_Theory/PThy_Chapter_3/PThy_Chapter_3.html (14484 words)

	Appendix to Chapter 5: Indifference Curve Analysis (Site not responding. Last check: 2007-10-21)
		That is, an indifference curve is a collection of points that the consumer is "indifferent between." This will become more clear as we look at the graphical construction of these.
		The indifference curve in red is the highest indifference curve the consumer can reach, given her income.
		Note that even for this indifference curve (the red one) the consumer can get just one point along this indifference curve, the point E. While the consumer values E the same as any other point along the red locus, for example X, the other points are outside of the budgetary constraint.
	www.business.uiuc.edu /ldebrock/econ102s04/oll/Chap04/ordut.htm (2573 words)

	Microeconomics with Dr. Sanjay Paul
		Indicate Point M on the curve such that the number of coconuts consumed is 20.
		The corresponding number of bagels is _____, and the slope of the curve at that point is ______.
		The magnitude of the slope of an indifference curve measures
	www.snc.edu /econ/sp/ec202/exercise-sets/set080indiff_curve.html (531 words)

	Preference 6 (Site not responding. Last check: 2007-10-21)
		Figure 1 is an Indifference Curve Diagram for wings and fries, partly based on the previous numerical example.
		An indifference curve is a curve connecting points in the diagram in such a way that the consumer is indifferent between any two combinations shown by points on the curve.
		Let's assume that all the other points on curve II also correspond with combinations of fries and wings (some in fractional amounts) that would all be tied with these three.
	william-king.www.drexel.edu /top/prin/txt/MUch/pref6.html (374 words)

	Consumer Theory
		There is an indifference curve through every bundle, because we assumed that people have preferences over all bundles.
		All points on the lower indifference curve are inferior to the middle indifference curve, so the Preferred and Affordable bundle must lie on the middle curve.
		If you experiment with indifference curves and budget constraints, you will discover that you can draw a picture where an increase in income leads to a decrease in the amount of one of the goods.
	are.berkeley.edu /~peter/EnvEcon/consumer.htm (529 words)

	Indifference Curves (Site not responding. Last check: 2007-10-21)
		The concept of indifference is a pivotal aspect of the theory on consumer behavior and demand.
		Differences in satisfaction associated with two indifference curves are depicted here to illustrate the graphical characteristics of indifference curves..
		a higher indifference curve means the individual derives greater satisfaction from that bundle of goods compared to a bundle yielding less utility and that appears on a lower indifference curve;
	nova.umuc.edu /~black/umax50.html (158 words)

	[No title] (Site not responding. Last check: 2007-10-21)
		ab} \pard \s2\fi-720\li1440\sl0\tx720\tx1440 {\\pn \pnlvl2\pnlcltr\pnstart1\pnindent720\pnhang{\pntxta.}} {\plain Therefore indifference* curve is bowed towards the origin\par }{\pntext\pard 4.
		ab} \pard \s2\fi-720\li1440\sl0\tx720\tx1440 {\\pn \pnlvl2\pnlcltr\pnstart1\pnindent720\pnhang{\pntxta.}} {\plain An indifference* curve further from the origin is preferred to one closer to the origin\par }{\pntext\pard i.
		ab} \pard \s2\fi-720\li1440\sl0\tx720\tx1440 {\\pn \pnlvl2\pnlcltr\pnstart1\pnindent720\pnhang{\pntxta.}} {\plain Equilibrium labor supply is given by the tangency of the indifference* curve and the budget set\par }\pard \sl0 {\plain \par }{\pntext\pard b.
	econ.bu.edu /lang/ec101/oct11.doc (1875 words)

	Definition of Indifference Curve (Site not responding. Last check: 2007-10-21)
		An indifference curve is a set of points with the same utility.
		A set of indifference curves is essentially a relief map of a utility function.
		Indifference curves must satisfy a property also required of relief map contours: indifference curves cannot cross.
	www.econmodel.com /classic/terms/ic.htm (60 words)

	[No title]
		The monopoly union demands wm because notice that at that point the union is tangent at its highest indifference curve given the demand curve.
		It is clear that by moving away form the demand curve both the firm as well as the union can improve their utility and profit without affecting the other.
		The resistance curve is downward sloping as the longer the duration the lower the wage the union will be willing to accept till a bare minimum wmin The firm chooses the lowest isoprofit curve that is tangent to the reaction curve - point P Thus the firm chooses the strike duration that maximizes its profit.
	web.syr.edu /~ankumar/teaching/unions.doc (1484 words)

	Edgeworth's Box (Site not responding. Last check: 2007-10-21)
		B Crusoe is better off (moving from indifference curve IC to IC') while Friday is no worse off (he stays on the same indifference curve).
		A is an inefficient point because at this point the two indifference curves are not tangent to one another.
		Even though points on the contract curve are efficient, it is not necessarily the case that any point on the contract curve is better than a given point off the contract curve.
	www.louisville.edu /~bmhawo01/econpage/341/handouts/edgeworth.html (683 words)

	[No title]
		To illustrate the indifference curves, pick an initial bundle on the graph and ask which other bundles are likely to be more preferred and less preferred to the initial bundle.
		Draw the indifference curve associated with a utility level of 12 and the indifference curve associated with a utility level of 24.
		At the utility-maximizing level of consumption, the slope of the indifference curve is equal to the slope of the budget constraint.
	www.cba.uh.edu /fina/lecturers/WA-chap_3.doc (5155 words)

	Appendixes \| Instructor Resources \| Microeconomics and Behavior
		In the language of utility functions, an indifference curve is all combinations of F and S that yield the same level of utility—the same number of utils.
		At the optimal bundle, the slope of the indifference curve, or MRS, equals the slope of the budget constraint.
		In the language of utility functions, an indifference curve is all combinations of X and Y that yield the same level of utility.
	www.southwestern.edu /~earlyd/intermediate/appendix3-short.html (2807 words)

	[No title] (Site not responding. Last check: 2007-10-21)
		Suppose that country A is indifferent between the following consumption bundles: (C = 4000 and T = 150), (C = 3000 and T = 225), (C = 2000 and T = 375), (C = 1000, T = 600).
		Suggested Solution: An indifference curve is the collection of bundles of commodities between which the consumer is indifferent, i.e.
		the points (which are bundles of commodities) on the curve yield the same level of satisfaction in consumption to this consumer.
	econ.la.psu.edu /~cyavas/econ333/hw2s.doc (652 words)

	Homework (Site not responding. Last check: 2007-10-21)
		Both budget lines pass through the point (6,4) and there is an indifference curve through the 1995 budget line at that point.
		The 1996 budget line is steeper, which requires its tangency with an indifference curve to lie above and to the left of (6,4); moreover this indifference curve must lie above the curve through (6,4).
		Therefore your indifference curve is the curve tangent to L at A.
	www.montana.edu /econ/capalbo/econ201/answer_set_3.htm (453 words)

	Homework problems
		The socially optimal point is where UPF is tangent to the highest reachable social indifference curve.
		The original optimal choice for the individual with the preferences rendered by the indifference curves in the diagram above is at point A. Once she starts receiving housing assistance, she chooses to have more (better, more expensive) housing and somewhat less other goods (point B).
		Her utility would increase by the same proportion (the same indifference curve reached) but a lower cost for the society: $600-$500 = $100 net gain.
	www.uh.edu /~vlazarev/3377/Review1.htm (1862 words)

	[No title]
		The combinations of gasoline and coffee along one of Sam's indifference curves are combinations A) that require the same total expenditure.
		16) Suppose the quantity of burgers is on the horizontal axis and the quantity of French fries is measured on the vertical axis and Carol's indifference curves are drawn in the graph.
		A) budget line; demand curve for crackers B) demand curve; indifference curve for crackers C) budget line; demand curve for soda D) demand curve; indifference curve for soda 28) Gertrude has a $15 budget to spend on soda and crackers.
	www.aug.edu /~sbajmb/EconTestbank/ch11app.doc (1647 words)

	[No title]
		Now plot a few points on the indifference curve that fives Charlie utility of 300 and sketch this curve with fl ink or pencil.
		Label that point A. Neither of the indifference curves that you drew is tangent to Charlie’s budget line.
		This is the slope of his indifference curve at EMBED Equation.3 .
	www.people.virginia.edu /~lks7g/links/Ch.5V.doc (684 words)

	PART II
		More generallly, the slope of a linear indifference curve is the constant rate at which the consumer is willing to trade the two goods.
		The tangency of the indifference curve with the budget line represents the point at which the trade-offs are equal and consumer satisfaction is maximized.
		For Al, hamburgers are a "bad." His indifference curves slope upward and to the right rather than downward and to the left.
	www.coloradocollege.edu /dept/ec/Faculty/Smith/EC2070102/chap_03answers.htm (4451 words)

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