The marginal rate of substitution is
A) the slope of the utility curve.
B) the slope of the contract curve.
C) the slope of the utility possibilities curve.
D) none of these answer options are correct.

Question

Quizplus · Accepted Answer

The marginal rate of substitution (MRS) is the rate at which a consumer is willing to trade one good for another while maintaining the same level of utility. It is equal to the slope of the indifference curve, which represents the different combinations of goods that give the same level of satisfaction or utility to the consumer. So, the correct answer is A) the slope of the utility curve.

The Marginal Rate of Substitution Is