Figure 21-8

-Refer to Figure 21-8. As the consumer moves from A to B to C, the marginal rate of substitution
A)increases.
B)decreases.
C)remains constant.
D)first increases, then decreases.

Question

Figure 21-8  ​
​
-Refer to Figure 21-8. As the consumer moves from A to B to C, the marginal rate of substitution
A)increases. 
B)decreases. 
C)remains constant. 
D)first increases, then decreases.

Quizplus · Accepted Answer

The marginal rate of substitution (MRS) decreases as the consumer moves from A to B to C because the consumer is willing to give up fewer units of one good to get one more unit of the other good, reflecting the diminishing marginal utility.

Figure 21-8 ​

Figure 21-8