<P> Consumer theory uses indifference curves and budget constraints to generate consumer demand curves . For a single consumer, this is a relatively simple process . First, let one good be an example market e.g., carrots, and let the other be a composite of all other goods . Budget constraints give a straight line on the indifference map showing all the possible distributions between the two goods; the point of maximum utility is then the point at which an indifference curve is tangent to the budget line (illustrated). This follows from common sense: if the market values a good more than the household, the household will sell it; if the market values a good less than the household, the household will buy it . The process then continues until the market's and household's marginal rates of substitution are equal . Now, if the price of carrots were to change, and the price of all other goods were to remain constant, the gradient of the budget line would also change, leading to a different point of tangency and a different quantity demanded . These price / quantity combinations can then be used to deduce a full demand curve . A line connecting all points of tangency between the indifference curve and the budget constraint is called the expansion path . </P> <Ul> <Li> <P> Figure 1: An example of an indifference map with three indifference curves represented </P> </Li> <Li> <P> Figure 2: Three indifference curves where Goods X and Y are perfect substitutes . The gray line perpendicular to all curves indicates the curves are mutually parallel . </P> </Li> <Li> <P> Figure 3: Indifference curves for perfect complements X and Y . The elbows of the curves are collinear . </P> </Li> </Ul> <Li> <P> Figure 1: An example of an indifference map with three indifference curves represented </P> </Li> <P> Figure 1: An example of an indifference map with three indifference curves represented </P>

What are two of the properties of the indifference curve