MsSweettooth Always Consumes Iced Tea and Sugar in Fixed Proportions

question 269

Multiple Choice

Ms.Sweettooth always consumes iced tea and sugar in fixed proportions: 8 ounces of iced tea to 3 teaspoons of sugar.This implies that for Ms.Sweettooth the marginal rate of substitution of iced tea for sugar is:

• A)3/8.
• B)8/3.
• C)diminishing but between 8 and
• D)3.undefined.

---

Definitions:

Market Supply Curve

A graphical representation showing the relationship between the price of a good and the quantity of that good that all suppliers are willing to produce and sell.

Competitive Industry

A market scenario where numerous producers compete to offer goods or services to consumers, ensuring no single entity dominates the market prices or supply.

Price-Quantity

Relationship between the price of a good and the quantity of the good supplied or demanded.

Linear Marginal Cost

Refers to a situation where the additional cost of producing one more unit of output is constant.