Features or properties of Indifference curve

Indifference curve always slopes downward from left to right i.e., It must have a negative slope.

An indifference curve will always have a negative slope. This is because when the consumer has limited income the increase in the consumption of one commodity is possible only by reducing the consumption of another commodity. This will help the consumer to get the same level of satisfaction. If the consumer wants to consumer another unit of Commodity A, he has to sacrifice some units of Commodity B, because of limited income.

If the indifference curve is upward sloping or if it is vertical or horizontal – this above condition can’t be explained as shown in the following diagrams. Indifference curves are convex to the origin

The law of Diminishing Rate of Substitution could be explained only if it is convex to the origin. When the satisfaction derived is less the sacrifice will also be less. This is law of diminishing rate of substitution.

If the Indifference Curve is a straight line or concave to the origin – this concept cann’t be explained. In case of substitutes, the indifference curve will be a straight line and in case of complementary goods, the indifference curve will be ‘L’ shaped. An indifference curve drawn to the right hand side of an existing indifference curve represents higher level of satisfaction In the diagram, in the 1st case the consumer is consuming OA of X commodity and OB of Y commodity. In the 2nd case the consumption of Y being constant, the consumer is consuming OA1 of X. When the consumption increases the satisfaction level also increases. Hence, IC2 represents higher level of satisfaction than IC1.

The collection of indifference curves/the family of indifference curves, is known as “Indifference Map”. In an indifference map, an Indifference curve at the extreme right represents highest level of satisfaction and the curve at the extreme left represents lowest amount of satisfaction. Hence IC4 > IC3 > IC2 > IC1. No two indifference curve intersects each other or be tangent to each other

Each indifference curve represents a particular level of satisfaction and indifference curve to the right represents higher satisfaction. If they intersect each other at one point both will give the same level of satisfaction, which is untrue. No indifference curve should touch the horizontal or either the vertical axis. The basic assumption is that the consumer purchases a combination of different commodities. Hence he is not supposed to buy only one commodity. But if the indifference curve touches either the horizontal axis or the vertical axis – it signifies that the consumer is buying only one commodity.

In the 1st diagram the consumer is purchasing only OB of Y commodity and none of X. In the 2nd diagram, the consumer is purchasing only OA of X commodity and no Y. Hence this is untrue.

The indifference curves need not be parallel to each other

The indifference curves need not be parallel to each other because the Marginal rate of Substitution mayn’t be the same in all the Indifference curves. Hence it is not a necessary condition that all the indifference curves should be parallel to each other. But in this, certain precautions needs to be taken. They are:
• The Indifference Curve should neither touch the horizontal axis or the vertical axis.
• No two indifference curve should intersect each other.
• It should be downward sloping
• All indifference curves must be convex to the origin.  