The marginal rate of substitution measures the
A)magnitude of the substitution effect.
B)total utility received by a consumer when equilibrium is achieved.
C)extra utility that a consumer derives from successive units of a product.
D)consumer's willingness to substitute one product for another so that total utility will remain constant.

Question

Quizplus · Accepted Answer

The marginal rate of substitution (MRS) measures the rate at which a consumer is willing to substitute one good for another while keeping their level of satisfaction or total utility constant. It reflects the trade-offs a consumer is willing to make between two goods.

The Marginal Rate of Substitution Measures the