Search results
Results from the WOW.Com Content Network
An example of how indifference curves are obtained as the level curves of a utility function. A graph of indifference curves for several utility levels of an individual consumer is called an indifference map. Points yielding different utility levels are each associated with distinct indifference curves and these indifference curves on the ...
If the axes depicting coconut collection and leisure are reversed and plotted with Crusoe's indifference map and production function, [1] figure 2 can be drawn: Figure 2: The Robinson Crusoe economy's production function and indifference curves. The production function is concave in two dimensions and quasi-convex in three dimensions. This ...
An indifference curve can be detected in a market when the economics of scope is not overly diverse, or the goods and services are part of a perfect market. Any bundles on the same indifference curve have the same utility level. One example of this is deodorant. Deodorant is similarly priced throughout several different brands.
A set of convex-shaped indifference curves displays convex preferences: Given a convex indifference curve containing the set of all bundles (of two or more goods) that are all viewed as equally desired, the set of all goods bundles that are viewed as being at least as desired as those on the indifference curve is a convex set.
In two dimensional case, the indifference curves are parallel; which is useful because the entire utility function can be determined from a single indifference curve. Definition in terms of utility functions
The concave portions of the indifference curves and their many-dimensional generalizations, if they exist, must forever remain in unmeasurable obscurity. [ 12 ] The difficulties of studying non-convex preferences were emphasized by Herman Wold [ 13 ] and again by Paul Samuelson , who wrote that non-convexities are "shrouded in eternal darkness ...
For example, if the MRS xy = 2, the consumer will give up 2 units of Y to obtain 1 additional unit of X. As one moves down a (standardly convex) indifference curve, the marginal rate of substitution decreases (as measured by the absolute value of the slope of the indifference curve, which decreases).
Income–consumption curve; Indifference curve; Inverted yield curve; IS–LM model; IS/MP model; J. J curve; K. Kuznets curve; L. ... Media in category "Economics ...