What is indifference curve?

What Does indifference curve Mean

In order to know the meaning of the term indifference curve, it is necessary, first of all, to discover the etymological origin of the two main words that give it its shape:

-Curve, first of all, comes from Latin. Specifically, it derives from "curvus", which can be translated as "curved".

-Indifference, secondly, also emanates from Latin. In his case, it derives from "indifferentia", which is synonymous with "quality of not distinguishing" and which is the result of the sum of four delimited components: the prefix "in-", which means "no"; the element "dis-", which is synonymous with "separation"; the verb “ferre”, which can be translated as “carry”; and the suffix "-ia", which is used to indicate "quality".

In the field of economics is usual to appeal to the notion of curve with reference to the graphical representation of the magnitude of a phenomenon: demand curve , supply curve , etc.

This time we are going to focus on the concept of the indifference curve , which allows us to know the different combinations of products that give the buyer the same degree of satisfaction. This makes it possible to analyze consumer behavior.
To obtain the indifference curve, the individual must be asked what combination of two products he prefers, varying the amounts of each. The greater the quantity of a product R , the less the quantity of a product S and vice versa. When arriving at two options that are indifferent to the person , both points are on the same indifference curve. In this curve, all the points give you the same level of satisfaction .
What the indifference curve does is reveal the predilections between pairs of products , without taking into account the price of the good or consumer income. On the indifference curve, in fact, the different points have different monetary values, although the satisfaction they provide to the consumer is the same.
An indifference curve can be drawn by combining pizzas and empanadas , for example. The consumer can choose between different combinations: 4 pizzas and 24 empanadas, 6 pizzas and 18 empanadas, 8 pizzas and 12 empanadas, etc. The curve reveals how many pizzas you are willing to give up to buy more empanadas, and the same but the other way around (how many empanadas would you stop buying to get more pizzas).
In addition to all that is indicated, we cannot ignore an important series of data or characteristics of the flames regular indifference curves such as these:

-They do not intersect each other.

-They have a negative slope.

-They are convex at the origin.

-The further they are from the origin, the greater the level of utility they have.

-The slope of an indifference curve is called the marginal ratio of substitution.

Also, you should know that there are several types of indifference curves. Specifically, among the most frequent we can speak, for example, both of the indifference curves of goods that are perfect complements, as well as the so-called indifference curves of goods that are perfect substitutes.

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