All-you-can-eat restaurants charge a fixed price that permits unlimited access to prepared food.Suppose food consumption is on the horizontal axis and all other goods on the vertical axis.If the restaurant charges $10 per meal while the price of all other goods is $20,restaurant patrons will consume to a point on their indifference curve where their marginal rate of substitution of food for all other goods is equal to _____.
A)2
B)1/2
C)10
D)0

Question

Quizplus · Accepted Answer

At an all-you-can-eat restaurant, the marginal cost of consuming additional food is zero, so patrons will consume until their marginal rate of substitution of food for all other goods is zero.

All-You-Can-Eat Restaurants Charge a Fixed Price That Permits Unlimited Access