The slope of an indifference curve is equal to the ratio of the ____ of the good on the horizontal axis to the ____ of the good on the vertical axis.
A) marginal product; marginal product
B) marginal utility; marginal utility
C) price; price
D) total utility; price

Question

Quizplus · Accepted Answer

The slope of an indifference curve is given by the marginal rate of substitution (MRS), which measures the amount of one good a consumer is willing to give up in order to obtain one more unit of another good while remaining indifferent (or equally satisfied). The MRS is equal to the ratio of the marginal utility of the good on the horizontal axis to the marginal utility of the good on the vertical axis, since these are the two goods being compared in terms of their utility or satisfaction. Therefore, choice (B) is the correct answer.

The Slope of an Indifference Curve Is Equal to the Ratio