Explain why crossing indifference curves would lead to a logical inconsistency
What will be an ideal response?
Suppose two indifference curves cross, and consider the point of intersection. The consumer likes all points on the first indifference curve equally well as the point of intersection, and the consumer likes all points on the second indifference curve equally well as the point of intersection. We can conclude, therefore, that the consumer is indifferent between any point on the first indifference curve and any point on the second indifference curve. On the other hand, some points on the second indifference curve lie to the northeast of some points on first indifference curve, so the consumer prefers the former baskets to the latter ones because they contain more of both goods. The consumer cannot simultaneously be indifferent between these points and strictly prefer some over others, so we have a logical inconsistency and may conclude that indifference curves cannot cross.
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What will be an ideal response?
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