Exhibit 6-23
-In Exhibit 6-23, the marginal rate of substitution of clothing for food between points b and c is
A) unable to be determined
B) 2
C) 1/3
D) less than 1/3
E) 0

Question

Exhibit 6-23 
-In Exhibit 6-23, the marginal rate of substitution of clothing for food between points b and c is
A) unable to be determined 
B) 2 
C) 1/3 
D) less than 1/3 
E) 0

Quizplus · Accepted Answer

The marginal rate of substitution (MRS) between two points on an indifference curve is the slope of the line that connects those points. Therefore, the MRS of clothing for food between points b and c can be calculated as the change in the quantity of clothing (ΔC) divided by the change in the quantity of food (ΔF) as we move from point b to point c on the indifference curve. From the graph, we can see that the change in clothing is +2 and the change in food is -6, so the MRS is 2/(-6) which simplifies to -1/3. Since we are looking for the absolute value of the MRS, the answer is less than 1/3, or choice D.

Exhibit 6-23 -In Exhibit 6-23, the Marginal Rate of Substitution of Clothing