Question

 Assertion (A): A higher indifference curve is preferred to a lower indifference curve.

Reason (R): The higher indifference curve gives higher level of satisfaction.

Options

• Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation for Assertion (A).

• Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation for Assertion (A).

• Assertion (A) is true and Reason (R) is false.

• Both Assertion (A) and Reason (R) are false.

Answer 1

Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation for Assertion (A).

Explanation:

A higher indifference curve contains larger bundles of goods that provide more utility based on the assumption of monotonic preferences. Because consumers always seek to maximize their total utility, they naturally prefer a higher curve precisely because it yields a higher level of satisfaction.