An indifference curve is a curve showing the various combinations of two goods among which a consumer is indifferent, i.e. he equally prefers these combinations. The consumer will value these combinations equally only if they give him more satisfaction than the other, he would surely prefer it to the other. Thus, indifference curve shows these combinations of goods which give the consumer an equal satisfaction. An indifference curve is defined as locus of points formed by such combinations of two goods that yield equal satisfaction to a consumer and thus he is indifferent to making any choice among these combinations.
To draw an indifference curve we formulate various combinations or bundles of these two goods in such a manner that all the bundles give equal satisfaction to the consumer. Such hypothetical bundles. This tabular presentation of various bundles of two goods giving equal satisfaction is called indifference schedule.
Combination Giving Equal Satisfaction
| Combination | Goods Y | Goods X |
| A B C D E F |
35 25 18 13 8 5 |
5 10 15 20 25 30 |
By plotting these combinations we get the indifference curve IC. Unit of X are measured on X – axis and that of Y on the Y – axis.
The line joining the points ABCDE and F is the indifference curve IC. An indifference curve can thus be defined as a curve which shows all the various combinations of two goods X and Y that give equal satisfaction to a consumer and hence he is indifferent among them.
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