The marginal rate of substitution (MRS) determines the rate at which a consumer is willing to substitute between two goods in order to achieve
A)a higher level of satisfaction.
B)a lower level of satisfaction.
C)the same level of satisfaction.
D)none of the statements associated with this question are correct.

Question

Quizplus · Accepted Answer

The marginal rate of substitution determines the rate of substitution between two goods that will give the consumer the same level of satisfaction. The consumer may be willing to substitute more of one good for the other if the price or availability changes, but the ultimate goal is to maintain the same level of satisfaction.

The Marginal Rate of Substitution (MRS) Determines the Rate at Which