Suppose at the Current Consumption Bundle, the Marginal Rate of Substitution

question 77

Multiple Choice

Suppose at the current consumption bundle, the marginal rate of substitution of pizza for pepsi is 4 litres of pepsi for every one pizza.If we took four litres of pepsi away from our consumer and gave them one extra pizza, which of the following statements would be correct?

• A)the consumer would be on a higher indifference curve
• B)the consumer would be on a lower indifference curve
• C)the consumer's marginal rate of substitution of pepsi for pizza would rise
• D)the consumer's marginal rate of substitution of pepsi for pizza would fall

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Definitions:

Citric Acid Cycle

The citric acid cycle, also known as the Krebs cycle or TCA cycle, is a series of chemical reactions used by all aerobic organisms to generate energy through the oxidation of acetate derived from carbohydrates, fats, and proteins into carbon dioxide.

Acetyl CoA

A molecule that plays a key role in metabolism, linking glycolysis and beta-oxidation to the citric acid cycle; essential for the production of energy from food.

CO2

A greenhouse gas present in the Earth's atmosphere, consisting of two oxygen atoms covalently bonded to a single carbon atom, vital for life processes like photosynthesis.

Phosphofructokinase

An enzyme that plays a critical role in regulating the rate of glycolysis, controlling the conversion of fructose 6-phosphate to fructose 1,6-bisphosphate.