Moving along an indifference curve,if a consumer requires a large amount of the good measured along the y-axis to make up for one unit less of the good measured on the x-axis,then
A) total utility is increasing.
B) the marginal rate of substitution is low and the indifference curve is flat.
C) the marginal rate of substitution is low and the indifference curve is steep.
D) the marginal rate of substitution is high and the indifference curve is steep.
E) the marginal rate of substitution is high and the indifference curve is flat.

Question

Quizplus · Accepted Answer

The marginal rate of substitution (MRS) represents the rate at which a consumer is willing to substitute one good for another while maintaining the same level of utility. A high MRS, meaning the consumer requires a large amount of one good to replace a small amount of another, corresponds to a steep indifference curve. This indicates a strong preference for the good on the x-axis over the one on the y-axis.

Moving Along an Indifference Curve,if a Consumer Requires a Large