Question

What is the difference between slope of indifference curve and slope of budget line?

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Hint. Slope of IC shows the rate at which consumer is willing to substitute one good for the other good whereas slope of budget line shows ratio between P_x and P_y (i.e., P_x/P_y).

Some More Questions From Theory Of Consumer Behaviour Chapter

Distinguish between 'Change in demand' and 'Change in quantity demanded of a commodity'.

Starting from an initial situation of consumer's equilibrium, suppose that marginal utility of a rupee increases. Will it increase or decrease the quantity demanded of the product?

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Theory Of Consumer Behaviour

What is the difference between slope of indifference curve and slope of budget line?

Some More Questions From Theory Of Consumer Behaviour Chapter

Distinguish between 'Change in demand' and 'Change in quantity demanded of a commodity'.

Starting from an initial situation of consumer's equilibrium, suppose that marginal utility of a rupee increases. Will it increase or decrease the quantity demanded of the product?

What are two approaches to attain the state of consumer's equilibrium?

Define indifference curve.

What is meant by marginal rate of substitution (MRS)?

Why is MRS always diminishing?

When does a consumer attain equilibrium according to indifference curve approach?

Give meaning of demand.

Name two determinants of demand.

List the factors that cause changes in demand.

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