If the MU/P ratio for two goods is the same, then
A)the slope of the budget constraint between the two goods is equal to the marginal rate of substitution (MRS) between the two goods.
B)the indifference curve between the two goods is concave to the origin.
C)the prices of the two goods are the same.
D)it follows that consumers prefer fewer goods to more goods.
E)a and c

Question

Quizplus · Accepted Answer

When the MU/P ratio for two goods is the same, it indicates that the consumer is maximizing utility, meaning the marginal rate of substitution (MRS) is equal to the slope of the budget constraint.

If the MU/P Ratio for Two Goods Is the Same