The Marginal Rate of Substitution

question 47

Multiple Choice

The marginal rate of substitution

• A)is the amount of good Y substituted for good X as a consumer moves along his budget line.
• B)is the rate at which a person gives up the good measured on the y-axis to get an additional unit of the good measured on the x-axis while remaining on the same indifference curve.
• C)increases as a consumer consumes more of the good measured on the x-axis.
• D)is greater than the magnitude of the slope of the budget line.
• E)is equal to the slope of the budget line.

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