Why IC need not be parallel to each other?what does this mean?
Dear Student,
Indifference curves need not be parallel because the rate of diminishing marginal substitution of two goods is not necessarily equal to the other indifference curves.
In the above diagram the marginal rate substitution of I1 is different from I2.
Regards
Indifference curves need not be parallel because the rate of diminishing marginal substitution of two goods is not necessarily equal to the other indifference curves.
In the above diagram the marginal rate substitution of I1 is different from I2.
Regards