True or false: indifference curves

Exercise and reference answers

Questions

1. Statement is true

   Yes

   Statement

   All points on one indifference curve give the consumer the same satisfaction.

2. Statement is true

   Yes

   Statement

   An indifference curve slopes downward.

3. Statement is true

   No

   Statement

   Bundles on a higher indifference curve are less preferred.

4. Statement is true

   Yes

   Statement

   For perfect substitutes the marginal rate of substitution stays the same.

Instructions

Decide whether each statement about indifference curves is true or false.

Explanation