The Concept of Diminishing Marginal Rate of Substitution Indicates That

question 376

Multiple Choice

The concept of diminishing marginal rate of substitution indicates that

• A) as the consumption of good X increases, individuals are willing to give up an increasing amount of good Y in order to obtain one more unit of good X.
• B) as the consumption of good X increases, individuals are willing to give up a decreasing amount of good Y in order to obtain one more unit of good X.
• C) along an indifference curve, a consumer prefers the consumption combinations moving to the northwest along the curve.
• D) None of the above answers is correct.

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A measure of the profitability of a venture after accounting for the full cost of capital, including both the cost of debt and the opportunity cost of equity.

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The fair and just distribution of wealth, opportunities, and privileges within a society.

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Regions with low rainfall that are made suitable for agriculture through the use of irrigation systems.

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