Jewel's utility is a function of golf (G) and music lessons (M), where MU_G = 1/G and MU_M = 1/M. What is MRS_GM when M = 10 and G = 4? A) 2.5 B) 14 C) 0.4 D) 6

Name: Jewel's utility is a function of golf (G) and music lessons (M), where MU G = 1/G and MU M = 1/M. What is MRS GM when M = 10 and G = 4? A) 2.5 B) 14 C) 0.4 D) 6
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Question

Quizplus · Accepted Answer

The marginal rate of substitution (MRS) is the ratio of the marginal utilities: MRS_GM = MU_G / MU_M. Substituting the given values, MRS_GM = (1/4) / (1/10) = 2.5.

Jewel's Utility Is a Function of Golf (G) and Music