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Can marginal rate of substitution may increase or decrease in absolute value as one moves southeast along an indifference curve depending upon whether the substitution or income effect is dominant?
Indifference curves are downward sloping (negative slope) - therefore they are flatter towards the south east. the marginal rate of substitution is defined as the amount of good y (along the y axis) that is necessary to substitute for 1 good x (along the x axis) so that the effective bundle (or utility) remains the same. In effect the MRS is the slope of the indifference curve at a particular point. Therefore, MRS decreases as you move southeast along an indifference curve.
Give details that why an Indifference Curve is not concave?
Because of diminishing marginal rate of substitution, which is the principle that the more of one good a consumer has, the more they are willing to give up for an additional unit of the other good. Therefore the indifference curve must get flatter as we go along it
What happens to the marginal rate of substitution as you move along a convex indifference curve?
The MRS measures how much of a good you are willing to give up in exchange for one more unit of the other good, keeping utility constant. The MRS diminishes along a convex indifference curve in that as you move down along the indifference curve, you are willing to give up less and less of the one good in exchange for the other. The MRS is also the slope of the indifference curve, which increases (becomes less negative) as you move down along the indifference curve. The MRS is constant along a linear indifference curve, since in this case the slope does not change. The consumer is always willing to trade the same number of units of one good in exchange for the other.
Why is indifference curve of normal good convex to origin?
Indifference curves are convex to the point of origin of the two axes. The curve is relatively steep at first in its left hand portion and tends to become flatter in its right hand portion. Thus, as we move along the curve from left downwards to the right, the absolute slope of the indifference curve decreases.. This property of indifference curve is based on the principle of diminishing marginal rate of substitution, explained in the previous section. In Fig., as the consumer reduces the consumption of commodity 'Y' and increases the consumption of commodity 'X', his urge for more units of 'X' declines continuously. On the other hand, he is willing to part with fewer and fewer units of commodity' Y' at each stage to obtain each additional unit of 'X'. In other words, the marginal rate of substitution of 'X' for 'Y' declines, as the consumer travels down on an indifference curve.Fig.Suppose, 'A', 'B', 'C', and 'D' are four points on indifference curve IC in Fig.. Initially, the consumer is willing to part with Y1 Y2 units of commodity' Y' to get one unit X1 X2 of commodity 'X'. For additional one unit X2 X3 of 'X', he is ready to sacrifice Y2 Y3 units of 'Y'. For next one unit X3 X4 of 'X', the consumer would like to give up only Y3 Y4 units of 'Y'. Clearly, the increase in 'X' commodity is uniform, whereas 'Y' commodity is decreasing at a diminishing rate. Symbolically,X1 X2=X2 X3=X3 X4,whileY1 Y2 >Y2 Y3 >Y3 Y4Hence, indifference curves are convex to the origin. Concavity of the indifference curves is against the principle of diminishing marginal rate of substitution.
Describe the characteristics of indifference curve?
Properties/Characteristics of Indifference Curve:Definition, Explanation and Diagram:An indifference curve shows combination of goods between which a person is indifferent. The main attributes or properties or characteristics of indifference curves are as follows:(1) Indifference Curves are Negatively Sloped:The indifference curves must slope down from left to right. This means that an indifference curve is negatively sloped. It slopes downward because as the consumer increases the consumption of X commodity, he has to give up certain units of Y commodity in order to maintain the same level of satisfaction.In fig. 3.4 the two combinations of commodity cooking oil and commodity wheat is shown by the points a and b on the same indifference curve. The consumer is indifferent towards points a and b as they represent equal level of satisfaction.At point (a) on the indifference curve, the consumer is satisfied with OE units of ghee and OD units of wheat. He is equally satisfied with OF units of ghee and OK units of wheat shown by point b on the indifference curve. It is only on the negatively sloped curve that different points representing different combinations of goods X and Y give the same level of satisfaction to make the consumer indifferent.(2) Higher Indifference Curve Represents Higher Level:A higher indifference curve that lies above and to the right of another indifference curve represents a higher level of satisfaction and combination on a lower indifference curve yields a lower satisfaction.In other words, we can say that the combination of goods which lies on a higher indifference curve will be preferred by a consumer to the combination which lies on a lower indifference curve.In this diagram (3.5) there are three indifference curves, IC1, IC2 and IC3 which represents different levels of satisfaction. The indifference curve IC3 shows greater amount of satisfaction and it contains more of both goods than IC2 and IC1 (IC3 > IC2 > IC1).(3) Indifference Curve are Convex to the Origin:This is an important property of indifference curves. They are convex to the origin (bowed inward). This is equivalent to saying that as the consumer substitutes commodity X for commodity Y, the marginal rate of substitution diminishes of X for Y along an indifference curve.In this figure (3.6) as the consumer moves from A to B to C to D, the willingness to substitute good X for good Y diminishes. This means that as the amount of good X is increased by equal amounts, that of good Y diminishes by smaller amounts. The marginal rate of substitution of X for Y is the quantity of Y good that the consumer is willing to give up to gain a marginal unit of good X. The slope of IC is negative. It is convex to the origin.(4) Indifference Curve Cannot Intersect Each Other:Given the definition of indifference curve and the assumptions behind it, the indifference curves cannot intersect each other. It is because at the point of tangency, the higher curve will give as much as of the two commodities as is given by the lower indifference curve. This is absurd and impossible.In fig 3.7, two indifference curves are showing cutting each other at point B. The combinations represented by points B and F given equal satisfaction to the consumer because both lie on the same indifference curve IC2. Similarly the combinations shows by points B and E on indifference curve IC1 give equal satisfaction top the consumer.If combination F is equal to combination B in terms of satisfaction and combination E is equal to combination B in satisfaction. It follows that the combination F will be equivalent to E in terms of satisfaction. This conclusion looks quite funny because combination F on IC2 contains more of good Y (wheat) than combination which gives more satisfaction to the consumer. We, therefore, conclude that indifference curves cannot cut each other.(5) Indifference Curves do not Touch the Horizontal or Vertical Axis:One of the basic assumptions of indifference curves is that the consumer purchases combinations of different commodities. He is not supposed to purchase only one commodity. In that case indifference curve will touch one axis. This violates the basic assumption of indifference curves.In fig. 3.8, it is shown that the in difference IC touches Y axis at point C and X axis at point E. At point C, the consumer purchase only OC commodity of rice and no commodity of wheat, similarly at point E, he buys OE quantity of wheat and no amount of rice. Such indifference curves are against our basic assumption. Our basic assumption is that the consumer buys two goods in combination.
Can marginal rate of substitution may increase or decrease in absolute value as one moves southeast along an indifference curve depending upon whether the substitution or income effect is dominant?
Indifference curves are downward sloping (negative slope) - therefore they are flatter towards the south east. the marginal rate of substitution is defined as the amount of good y (along the y axis) that is necessary to substitute for 1 good x (along the x axis) so that the effective bundle (or utility) remains the same. In effect the MRS is the slope of the indifference curve at a particular point. Therefore, MRS decreases as you move southeast along an indifference curve.
What are market rate of substitution?
The marginal rate of substitution (MRS) is the rate at which a consumer is willing to trade one good for another while maintaining the same level of utility. It measures the relative value of goods as they are substituted for each other along an indifference curve.
Give details that why an Indifference Curve is not concave?
Because of diminishing marginal rate of substitution, which is the principle that the more of one good a consumer has, the more they are willing to give up for an additional unit of the other good. Therefore the indifference curve must get flatter as we go along it
What happens to the marginal rate of substitution as you move along a convex indifference curve?
The MRS measures how much of a good you are willing to give up in exchange for one more unit of the other good, keeping utility constant. The MRS diminishes along a convex indifference curve in that as you move down along the indifference curve, you are willing to give up less and less of the one good in exchange for the other. The MRS is also the slope of the indifference curve, which increases (becomes less negative) as you move down along the indifference curve. The MRS is constant along a linear indifference curve, since in this case the slope does not change. The consumer is always willing to trade the same number of units of one good in exchange for the other.
Why is indifference curve of normal good convex to origin?
Indifference curves are convex to the point of origin of the two axes. The curve is relatively steep at first in its left hand portion and tends to become flatter in its right hand portion. Thus, as we move along the curve from left downwards to the right, the absolute slope of the indifference curve decreases.. This property of indifference curve is based on the principle of diminishing marginal rate of substitution, explained in the previous section. In Fig., as the consumer reduces the consumption of commodity 'Y' and increases the consumption of commodity 'X', his urge for more units of 'X' declines continuously. On the other hand, he is willing to part with fewer and fewer units of commodity' Y' at each stage to obtain each additional unit of 'X'. In other words, the marginal rate of substitution of 'X' for 'Y' declines, as the consumer travels down on an indifference curve.Fig.Suppose, 'A', 'B', 'C', and 'D' are four points on indifference curve IC in Fig.. Initially, the consumer is willing to part with Y1 Y2 units of commodity' Y' to get one unit X1 X2 of commodity 'X'. For additional one unit X2 X3 of 'X', he is ready to sacrifice Y2 Y3 units of 'Y'. For next one unit X3 X4 of 'X', the consumer would like to give up only Y3 Y4 units of 'Y'. Clearly, the increase in 'X' commodity is uniform, whereas 'Y' commodity is decreasing at a diminishing rate. Symbolically,X1 X2=X2 X3=X3 X4,whileY1 Y2 >Y2 Y3 >Y3 Y4Hence, indifference curves are convex to the origin. Concavity of the indifference curves is against the principle of diminishing marginal rate of substitution.
Describe the characteristics of indifference curve?
Properties/Characteristics of Indifference Curve:Definition, Explanation and Diagram:An indifference curve shows combination of goods between which a person is indifferent. The main attributes or properties or characteristics of indifference curves are as follows:(1) Indifference Curves are Negatively Sloped:The indifference curves must slope down from left to right. This means that an indifference curve is negatively sloped. It slopes downward because as the consumer increases the consumption of X commodity, he has to give up certain units of Y commodity in order to maintain the same level of satisfaction.In fig. 3.4 the two combinations of commodity cooking oil and commodity wheat is shown by the points a and b on the same indifference curve. The consumer is indifferent towards points a and b as they represent equal level of satisfaction.At point (a) on the indifference curve, the consumer is satisfied with OE units of ghee and OD units of wheat. He is equally satisfied with OF units of ghee and OK units of wheat shown by point b on the indifference curve. It is only on the negatively sloped curve that different points representing different combinations of goods X and Y give the same level of satisfaction to make the consumer indifferent.(2) Higher Indifference Curve Represents Higher Level:A higher indifference curve that lies above and to the right of another indifference curve represents a higher level of satisfaction and combination on a lower indifference curve yields a lower satisfaction.In other words, we can say that the combination of goods which lies on a higher indifference curve will be preferred by a consumer to the combination which lies on a lower indifference curve.In this diagram (3.5) there are three indifference curves, IC1, IC2 and IC3 which represents different levels of satisfaction. The indifference curve IC3 shows greater amount of satisfaction and it contains more of both goods than IC2 and IC1 (IC3 > IC2 > IC1).(3) Indifference Curve are Convex to the Origin:This is an important property of indifference curves. They are convex to the origin (bowed inward). This is equivalent to saying that as the consumer substitutes commodity X for commodity Y, the marginal rate of substitution diminishes of X for Y along an indifference curve.In this figure (3.6) as the consumer moves from A to B to C to D, the willingness to substitute good X for good Y diminishes. This means that as the amount of good X is increased by equal amounts, that of good Y diminishes by smaller amounts. The marginal rate of substitution of X for Y is the quantity of Y good that the consumer is willing to give up to gain a marginal unit of good X. The slope of IC is negative. It is convex to the origin.(4) Indifference Curve Cannot Intersect Each Other:Given the definition of indifference curve and the assumptions behind it, the indifference curves cannot intersect each other. It is because at the point of tangency, the higher curve will give as much as of the two commodities as is given by the lower indifference curve. This is absurd and impossible.In fig 3.7, two indifference curves are showing cutting each other at point B. The combinations represented by points B and F given equal satisfaction to the consumer because both lie on the same indifference curve IC2. Similarly the combinations shows by points B and E on indifference curve IC1 give equal satisfaction top the consumer.If combination F is equal to combination B in terms of satisfaction and combination E is equal to combination B in satisfaction. It follows that the combination F will be equivalent to E in terms of satisfaction. This conclusion looks quite funny because combination F on IC2 contains more of good Y (wheat) than combination which gives more satisfaction to the consumer. We, therefore, conclude that indifference curves cannot cut each other.(5) Indifference Curves do not Touch the Horizontal or Vertical Axis:One of the basic assumptions of indifference curves is that the consumer purchases combinations of different commodities. He is not supposed to purchase only one commodity. In that case indifference curve will touch one axis. This violates the basic assumption of indifference curves.In fig. 3.8, it is shown that the in difference IC touches Y axis at point C and X axis at point E. At point C, the consumer purchase only OC commodity of rice and no commodity of wheat, similarly at point E, he buys OE quantity of wheat and no amount of rice. Such indifference curves are against our basic assumption. Our basic assumption is that the consumer buys two goods in combination.
Type of placentation in a pride of barbados flower?
The Pride of Barbados flower has parietal placentation, where the ovules are borne along the inner wall (parietal) of the ovary. This type of placentation is common in plants with multi-carpellate, unilocular ovaries like those found in Pride of Barbados.
Why does the marginal cost curve correspond to the supply curve?
A perfectly competitive firm's supply curve is that portion of its' marginal cost curve that lies above the minimum of the average variable cost curve. A perfectly competitive firm maximizes profit by producing the quantity of output that equates price and marginal cost. As such, the firm moves along it's marginal cost curve in response to alternative prices. Because the marginal cost curve is positively sloped due to the law of diminishing marginal returns, the firm's supply curve is also positively sloped.
Why indifference curves usually not be upward sloping?
Indifference curves are typically not upward sloping because they represent tradeoff's between economic "goods," things we like to have. For example, you might be willing to trade two scoops of vanilla ice cream for one slice of apple pie. You would be happier if you had both, but that would put you on a higher indifference curve. You are indifferent between two scoops of vanilla ice cream and once slice of apple pie-you value them equally. This can change as we move along indifference curves, because the "marginal utility" you get from consuming a given good begins to diminish after awhile (if you've already had eight scoops of ice cream, another probably doesn't look so good right now). If you only had one slice of apple pie, you would not trade it for one scoop of ice cream, but perhaps if you had three pieces of pie you would. If you had sixty pieces of pie, you almost certainly would.Sometimes we do see indifference curves slope upward. We could frame that as work hours and income perhaps (the model really only works for people who can choose the number of hours they spend working). Say I dislike my job, but I like money. And that I make $10 an hour. I might be willing to work six hours in exchange for $60, but to get me to work 8 hours, you'll have to pay me $80. This indifference curve slopes upward, because the exchange is between an economic good, and an economic "bad."
What is manicotti cheese and what is a good substitution?
Ricotta is the usual cheese used for manicotti filling, along with some shredded mozzarella. Cottage cheese can be substituted for the ricotta.
What will change in market price cause movement along?
Change in market price will cause movement along the demand curve.
What is point mutation substitution?
When a nitrogen base is substituted for a different one so it may code for a different amino acid. Sometimes substitution still codes for a same amino acid, in which case it becomes a silent mutation, but in other times it may alter the protein entirely.
