Assume that a consumer's indifference curve is bowed inward and negatively sloped. As the consumer moves from left to right along the horizontal axis, the consumer's marginal rate of substitution
A)increases.
B)decreases.
C)remains constant.
D)increases, then decreases.

Question

Quizplus · Accepted Answer

When an indifference curve is bowed inward and negatively sloped, the marginal rate of substitution (MRS) decreases as the consumer moves from left to right along the horizontal axis. This is because the consumer is willing to give up fewer units of one good to gain an additional unit of another good as they obtain more of that good, reflecting diminishing marginal utility.

Assume That a Consumer's Indifference Curve Is Bowed Inward and Negatively