Figure: Music and Movie Downloads 3 Refer to the Figure

question 17

Multiple Choice

Figure: Music and Movie Downloads 3 Refer to the figure. What is the marginal rate of substitution (MRS) between bundle A and bundle B in this figure?

• A) The MRS is 4.5; the consumer is willing to trade 4.5 movie downloads for 1 music download.
• B) The MRS is 3; the consumer is willing to give up 3 movie downloads for an additional music download.
• C) The MRS is 1.5; the consumer will buy 1.5 times as many music downloads as movie downloads.
• D) The MRS is 1; the consumer faces a one-to-one tradeoff.

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Definitions:

Broadcast Networks

Traditional media outlets, like television and radio networks, that distribute content to a wide audience.

Hobbyists

Individuals who engage in a pursuit or interest in their leisure time for pleasure rather than as a main occupation.

Pew Research Center

A nonpartisan American think tank based in Washington, D.C., that provides information on social issues, public opinion, and demographic trends shaping the United States and the world.

Professional Groups

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