The marginal rate of technical substitution always equals
A)the slope of the total product curve.
B)minus the ratio of the marginal products of inputs.
C)the change in output due to a change in the amount of one input.
D)the distance between two isoquants.

Question

Quizplus · Accepted Answer

The marginal rate of technical substitution (MRTS) measures the rate at which one input can be substituted for another without affecting the level of output. It is defined as the ratio of the marginal product of the input being reduced to the marginal product of the input being increased (holding output constant). Mathematically, MRTS = - (MP1/MP2), where MP1 is the marginal product of input 1 and MP2 is the marginal product of input 2. Therefore, option B is the correct answer as it states that the MRTS is equal to minus the ratio of the marginal products of inputs.

The Marginal Rate of Technical Substitution Always Equals