The rate at which a consumer is willing to exchange one good for another, and maintain a constant level of satisfaction is:
A)the marginal rate of substitution.
B)the relative price ratio.
C)the value of marginal product.
D)the relative expenditure ratio.

Question

Quizplus · Accepted Answer

The rate at which a consumer is willing to exchange one good for another, while still obtaining the same level of utility, is called the marginal rate of substitution (MRS). Therefore, option A is the correct answer. Options B, C, and D do not define the concept mentioned in the question.

The Rate at Which a Consumer Is Willing to Exchange