Question

Jolly Gm___

Define the following curve :-

• Indifference Curve
• Production Possibility Curve

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Answer 1

What is an Indifference Curve?

It is a curve that represents all the combinations of goods that give the same satisfaction to the consumer. Since all the combinations give the same amount of satisfaction, the consumer prefers them equally. Hence the name Indifference Curve.

The production possibility frontier (PPF) is a curve depicting all maximum output possibilitiesfor two goods, given a set of inputs consisting of resources and other factors. The PPF assumes that all inputs are used efficiently.

Answer 2

Answer:

An indifference curve is a graph showing combination of two goods that give the consumer equal satisfaction and utility. Each point on an indifference curve indicates that a consumer is indifferent between the two and all points give him the same utility.