Which of the following statements is incorrect?
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An indifference curve slopes downward to the right.
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Convexity of a curve implies that the slope of the curve diminishes as one moves from left to right.
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The elasticity of substitution between two goods to a consumer is zero.
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The total effect of a change in the price of a commodity on its quantity demanded is called the price effect.
The elasticity of substitution measures how easily consumers can substitute between two goods when their relative prices change. It can range from zero (perfect complements used in fixed proportions) to infinity (perfect substitutes). Claiming it is always zero is incorrect because elasticity varies depending on the nature of goods and consumer preferences. Indifference curves do slope downward, and their convexity does imply diminishing marginal rates of substitution.