Indifferenssikäyrä

Indifferenssikyrvä is a Finnish term that translates to "indifference curve" in English, a fundamental concept in microeconomics. It represents a set of bundles of two goods that provide a consumer with the same level of utility or satisfaction. This means that a consumer is equally happy with any combination of goods lying on the same indifference curve.

Indifference curves are graphical representations and are typically convex to the origin. This convexity arises from the principle of diminishing marginal rate of substitution, which suggests that as a consumer acquires more of one good, they are willing to give up progressively less of another good to maintain the same level of satisfaction.

A consumer's preference map consists of multiple indifference curves, each representing a different level of utility. Curves further away from the origin represent higher levels of utility, indicating greater satisfaction. The slope of an indifference curve at any point is known as the marginal rate of substitution (MRS), which indicates the rate at which a consumer is willing to trade one good for another while remaining at the same utility level. Indifference curves cannot intersect, as this would imply a contradiction in consumer preferences.