(Figure: Marginal Rate of Substitution) Refer to the Figure

question 75

Multiple Choice

(Figure: Marginal Rate of Substitution) Refer to the figure.What is the marginal rate of substitution (MRS) betweenBundle A and Bundle B?
Figure: Marginal Rate of Substitution

• A)4.5; the consumer is willing to trade 4.5 movie downloads for one music download.
• B)three; the consumer is willing to give up three movie downloads for an additional music download.(True Answer )Correct
• C)1.5; the consumer will buy 1.5 times as many music downloads as movie downloads.
• D)one; the consumer faces a one-to-one trade-off.