Table of contents

0. Basic Principles of Economics1h 5m
1. Reading and Understanding Graphs59m
2. Introductory Economic Models1h 10m
3. The Market Forces of Supply and Demand2h 26m
4. Elasticity2h 26m
5. Consumer and Producer Surplus; Price Ceilings and Floors3h 45m
6. Introduction to Taxes and Subsidies1h 46m
7. Externalities1h 12m
8. The Types of Goods1h 13m
9. International Trade1h 16m
10. The Costs of Production2h 35m
11. Perfect Competition2h 23m
12. Monopoly2h 13m
13. Monopolistic Competition1h 9m
14. Oligopoly1h 26m
15. Markets for the Factors of Production1h 26m
16. Income Inequality and Poverty35m
17. Asymmetric Information, Voting, and Public Choice39m
18. Consumer Choice and Behavioral Economics1h 16m

18. Consumer Choice and Behavioral Economics

Indifference Curves

Microeconomics

18. Consumer Choice and Behavioral Economics

Indifference Curves

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Multiple Choice

At different points along an indifference curve,

The marginal rate of substitution remains constant

The marginal rate of substitution is zero

A consumer prefers the consumption points that are further from the origin

A consumer does not prefer one consumption level over another

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Verified step by step guidance

Understand the concept of an indifference curve: An indifference curve represents a set of consumption bundles among which a consumer is indifferent, meaning they derive the same level of utility from each bundle.

Recognize the role of the Marginal Rate of Substitution (MRS): The MRS is the rate at which a consumer is willing to substitute one good for another while maintaining the same level of utility. It is the slope of the indifference curve at any given point.

Analyze the statement 'The marginal rate of substitution remains constant': This would imply a linear indifference curve, which is not typical for most preferences as it suggests perfect substitutes.

Consider the statement 'The marginal rate of substitution is zero': This would imply a vertical or horizontal indifference curve, which is not typical as it suggests perfect complements.

Evaluate the statement 'A consumer does not prefer one consumption level over another': This is the essence of an indifference curve, as it represents combinations of goods that provide the same utility level, meaning the consumer has no preference for one combination over another on the same curve.