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Indifference curves are downward sloping and are drawn bowed toward the origin (convex to the origin) implying:

A. Consumers prefer to have less satisfaction than more of both commodities

B. As more and more of one commodity is obtained, less and less of the other must be given up to keep satisfaction constant

C. The total satisfaction obtained along an indifference curve decreases at an increasing rate

D. None of the above

Correct Answer : B.


As the consumer substitute commodity X for commodity Y, the marginal rate of substitution (MRS) diminishes of X for Y along an indifference curve. It means as more and more of X commodity is obtained, less and less of the Y commodity must be given up to keep satisfaction same. That is why the indifference curve is convex to the origin also called bowed to the origin or bowed inward.

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