If Your Marginal Rate of Substitution Between Two Goods Diminishes

question 123

Multiple Choice

If your marginal rate of substitution between two goods diminishes continuously as you give up one good for the other, that means the

• A) price per unit of one good declines when you buy it in larger and larger quantities.
• B) two goods are perfect substitutes.
• C) two goods are perfect complements.
• D) two goods are neither perfect substitutes nor perfect complements.

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Definitions:

Punishing

The introduction of an adverse stimulus or the removal of a positive stimulus to decrease the likelihood of a behavior occurring in the future.

Pain-Induced Aggression

Anger and aggressive behavior elicited by punishment.

Organisms

Living entities that grow, reproduce, and maintain homeostasis, including plants, animals, fungi, and microorganisms.

Punishment

In behavior psychology, a consequence that reduces the likelihood of a behavior being repeated by applying an undesirable outcome or removing a desirable one after the undesired behavior.