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 same level of satisfaction or utility to the consumer.
An indifference curve is determined by the consumer's preferences and the trade-offs they are willing to make between the two goods. It is drawn by plotting different combinations of the two goods on a graph and connecting the points that provide the same level of satisfaction.
An indifference curve helps economists understand the behavior of consumers and how they make choices. It also helps in determining the optimal combination of goods that will maximize the consumer's satisfaction within their budget constraints.
The slope of an indifference curve represents the marginal rate of substitution, which is the rate at which a consumer is willing to give up one good to obtain more of the other good while maintaining the same level of satisfaction. It is calculated by dividing the change in quantity of one good by the change in quantity of the other good.
No, indifference curves cannot intersect because they represent different levels of satisfaction for the consumer. If they were to intersect, it would mean that the consumer would be equally satisfied at two different points, which goes against the concept of preferences and trade-offs.