By selecting a bundle where MRS = MRT,the consumer is saying
A) "I value my last unit of each good equally."
B) "I am willing to trade one good for the other at the same rate that I am required to do so."
C) "I will equate the amounts spent on all goods consumed."
D) All of the above.

Question

Quizplus · Accepted Answer

The statement "I am willing to trade one good for the other at the same rate that I am required to do so" accurately reflects the condition where the marginal rate of substitution (MRS) equals the marginal rate of transformation (MRT), indicating that the consumer's willingness to trade between two goods matches the market's rate of trade between those goods.

By Selecting a Bundle Where MRS = MRT,the Consumer Is