The rate at which a consumer is willing to purchase one good instead of another is called
A) the maximization rate.
B) opportunity cost.
C) the total rate of substitution.
D) the marginal rate of substitution.
E) the budget constraint.

Question

Quizplus · Accepted Answer

The rate at which a consumer is willing to purchase one good instead of another is called the marginal rate of substitution (MRS). It measures the amount of one good a consumer is willing to give up in exchange for an additional unit of another good. Therefore, the correct answer is D, the marginal rate of substitution.

The Rate at Which a Consumer Is Willing to Purchase