Figure 21-13
-Refer to Figure 21-13. As the consumer moves from A to B to C, the marginal rate of substitution
A)increases.
B)decreases.
C)remains constant.
D)first increases, then decreases.

Question

Figure 21-13 
-Refer to Figure 21-13. As the consumer moves from A to B to C, the marginal rate of substitution
A)increases. 
B)decreases. 
C)remains constant. 
D)first increases, then decreases.

Quizplus · Accepted Answer

As the consumer moves from A to B to C, the slope of the indifference curve becomes flatter (less negative) indicating a decrease in the marginal rate of substitution. This means that the consumer is willing to give up fewer units of good X to obtain each additional unit of good Y.

Figure 21-13 -Refer to Figure 21-13. as the Consumer Moves from a Moves