There will always be another product mix allocation pair that will make all consumers and producers better off unless MRT ___ MRS.

Question

Quizplus · Accepted Answer

When MRT (Marginal Rate of Transformation) equals MRS (Marginal Rate of Substitution), it means that the slope of the production possibility frontier (MRT) is equal to the slope of the indifference curve (MRS) at the point of equilibrium. At this point, resources are allocated efficiently, and there is no better allocation that can make both consumers and producers better off. Therefore, A) is the correct choice.

There Will Always Be Another Product Mix Allocation Pair That