Moving Down the Indifference Curve, the Marginal Rate of Substitution

question 68

Multiple Choice

Moving down the indifference curve, the marginal rate of substitution

• A) is constant.
• B) is rising.
• C) diminishes.
• D) is highly volatile.
• E) depends on household income.

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Definitions:

Creative Destruction

The continuous process of annihilating old and outdated business models or products to create new ones that benefit the economy.

Patent

An exclusive right given to inventors to produce and sell a new product or machine for 20 years from the time of patent application.

Government

The system or group of people governing an organized community, often a state, and the mechanisms through which state policy is enforced and affairs of the state are conducted.

Invention

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