The slope of the indifference curve is defined as
A)the marginal rate of transformation.
B)the relative price of good Y.
C)the marginal propensity to substitute.
D)the marginal rate of substitution.
E)the marginal propensity to consume.

Question

Quizplus · Accepted Answer

The slope of the indifference curve measures the rate at which a consumer is willing to trade one good for another while remaining indifferent. This is represented by the marginal rate of substitution, which is the amount of one good a consumer is willing to give up to obtain an additional unit of the other good. Therefore, the correct choice is D, the marginal rate of substitution.

The Slope of the Indifference Curve Is Defined as