what is consumer equilibrium explain in detail? what is ppc?
Production Possibility Curve (PPC) is a graph representing the various combinations of amount of two goods that can produced using the same fixed total amount of each of the factors of production.
There are two approaches to consumer equilibrium
i. Cardinal Approach
ii. Ordinal Approach
Ordinal Approach
A consumer's equilibrium is given at the point of tangency of the Indifference Curve and the budget line. At this point the consumer's willingness to consume (as represented by the IC) coincides with what he can actually consume (as given by the budget line). This point is the optimum or the best possible point and the consumption bundle represented by this point is the best optimum bundle.
Cardinal Approach
For cardinal approach, follow the link mentioned link.