An indifference curve is a graphical representation of a consumer's preferences for different combinations of two goods. It shows all the combinations of two goods that provide the consumer with the same level of satisfaction or utility.
A vertical indifference curve indicates that the consumer is completely indifferent between two goods and is willing to give up any amount of one good to get more of the other. This means that the consumer's preferences are not affected by changes in the quantity of one good, as long as the quantity of the other good remains the same.
A vertical indifference curve represents perfect substitutability between two goods, while a straight line indifference curve represents a constant trade-off between two goods. This means that the slope of a vertical indifference curve is infinite, while the slope of a straight line indifference curve is constant.
The slope of a vertical indifference curve represents the marginal rate of substitution (MRS) between two goods. This is the rate at which a consumer is willing to exchange one good for another while remaining on the same indifference curve. In the case of a vertical indifference curve, the MRS is infinite, indicating that the consumer is willing to trade an unlimited amount of one good for the other.
Vertical indifference curves can be seen in cases where two goods are perfect substitutes, such as generic products like generic brands of cereal or medication. In these cases, consumers are indifferent between the two goods and are willing to trade one for the other regardless of the quantity.