Final answer:
An indifference map reflects a consumer's preferences, highlighting combinations of goods that result in equal satisfaction. It reveals that as a consumer consumes more of a good, the additional satisfaction decreases.
Step-by-step explanation:
An indifference map implies a graphical representation of a consumer's preferences, illustrating different combinations of goods between which the consumer is indifferent. Each curve on the map, known as an indifference curve, shows combinations of goods that yield the same level of utility or satisfaction, meaning the consumer has no preference for one combination over another. On these curves, the principle of diminishing marginal utility is reflected: as the consumer has more of a good, the additional satisfaction received from consuming extra units decreases. A map of these curves can describe a wide range of preferences, revealing that to maintain the same level of satisfaction, if a consumer has less of one good, they will need more of another.
The indifference map is based on a set of assumptions rather than numerical estimates of utility. It provides a valuable tool for analyzing consumer choices and preferences without requiring the impossible task of quantifying satisfaction numerically. By examining the indifference map as a whole, economists can understand how a consumer might respond to changes in availability or prices of goods.