What is an indifferent curve in economics?
The concept of indifference curve is used to analyse many elements of the way demand for different goods in a market behaves without using the concept of utility. The concept is based on ideas first developed by the economist Vilfredo Pareto (1848-1923). The concept is based on comparing the consumer preference between two goods. When a consumer is offered choice between one of the two goods, his decision is based not only on the relative characteristics of the good, but also their quantities offered. A person may prefer apples to oranges, but if he is offered a choice between 1 apple and 10 oranges, he may choose 10 oranges. Thus it is possible to find out combinations of quantities of two goods that that are equally attractive to a consumer, or between which the consumer is indifferent.
An indifference curve is a curve drawn on a graph with its two axes representing amount two different goods consumed, and each point on on curve indicating different combination of two goods that provide exactly the same level of satisfaction for a given consumer.