The magnitude of the slope of the indifference curve between steak and lobster is called the marginal rate of substitution.

Question

Quizplus · Accepted Answer

This statement is true. The marginal rate of substitution (MRS) measures the rate at which a consumer is willing to trade one good for another while remaining indifferent or equally satisfied. It is equivalent to the magnitude of the slope of the indifference curve, which shows different combinations of goods that provide the same level of satisfaction.

The Magnitude of the Slope of the Indifference Curve Between