Consider indifference curves for goods X and Y. Suppose we plot the quantity of good Y on the vertical axis and the quantity of good X on the horizontal axis.
a. Why are indifference curves downward sloping?
b. What is the economic interpretation of the slope of an indifference curve?
c. Following what we learned in the Appendix to this chapter, indifference curves would flatten out as someone consumes more of good X and less of good Y. What are we assuming when we draw indifference curves that become flatter?