Download App

Theory of consumer behaviour — Economics STD 11 Commerce — Question

CBSE BoardEnglish MediumSTD 11 CommerceEconomicsTheory of consumer behaviour6 Marks
Question
Explain why is an indifference curve (a) downward sloping and (b) convex.
✓

Answer

  1. Indifference Curve Slopes Downwards: Because in order to consume More units of X good the consumer must give up some quantity of Y good, so that consumer remains on the same level of satisfaction at each point of Indifference Curve.
  2. Indifference Curve is convex to the origin: Because it is assumed that Marginal Rate of Substitution falls continuously as the consumer moves downwards along the curve. It is due to the Law of Diminishing Marginal Utility.

Need a full question paper?

Generate a complete, print-ready paper with questions like this in minutes — across 16+ boards, with answer keys.

Start Generating Free

Explore more

More "6 Marks Question" from Theory of consumer behaviour→Theory of consumer behaviour — all question types→Economics STD 11 Commerce question papers→CBSE Board STD 11 Commerce question papers→CBSE Board question paper generator→

Similar questions

Explain the effect of the following on the market demand of a commodity:
  1. Change in price of related goods.
  2. Change in the number of its buyers.
→
A firm's fixed cost is 2000. Compute TVC, AVC, TC and ATC from the following table.
Output (Units)
1
2
3
4
5
6
7
MC (₹)
 2000 1500 1200 1500 2000 2700 3500
→
If the monopolist firm of Exercise $3$, was a public sector firm. The government set a rule for its manager to accept the goverment fixed price as given (i.e. to be a price taker and therefore behave as a firm in a perfectly competitive market), and the government decide to set the price so that demand and supply in the market are equal. What would be the equilibrium price, quantity and profit in this case?
→
From the following total cost and total revenue schedule of a firm, find out the level of output, using marginal cost and marginal revenue approach, at which the firm would be in equilibrium. Give reasons for your answer.
Output (units) ₹ Total Revenue ₹ Total Cost ₹
1 10 8
2 18 15
3 24 21
4 28 25
5 30 33
→
Suppose that a firm's TFC is * 100 and MC schedule of the firm is the following:
Output (Units)
1
2
3
4
5
6
7
MC (₹)
10
20
30
40
50
60
70
  1. Is the MC curve U-shaped?
  2. Derive AVC schedule. Will the AVC curve be U-shaped? Discuss why or why not?
→
When does a demand curve take the shape of a rectangular hyperbola?
→
Complete the following table:
Price(₹) Output (Units) TR(₹) MR(₹)
7 -- 7 --
5 2 -- 3
4 -- 12 --
-- 4 -- (-)4
→
Define market demand. State the factors that affect it.
→
How is the equilibrium price determined under perfect competition? Explain with the help of a diagram.
OR
Show the determination of market equilibrium with the help of demand and supply schedules and a diagram.

OR
Explain the process of price determination under perfect competition with the help of a schedule and a diagram.
→
Explain the distinction between "change in quantity supplied" and "change in supply." Use diagram.
→