Asked by
David Allen
on Oct 25, 2024
Verified
The slope of an indifference curve reveals:
A) that preferences are complete.
B) the marginal rate of substitution of one good for another good.
C) the ratio of market prices.
D) that preferences are transitive.
E) none of the above
Marginal Rate
Typically refers to the additional cost or benefit received from producing one more unit of a good or service.
Indifference Curve
A graph that shows combinations of goods between which a consumer is indifferent, meaning they derive the same level of satisfaction from each combination.
Preferences
Individual tastes or desires that influence choice behavior, guiding decisions in the face of scarcity.
- Explore the manifestation of consumer preferences with indifference curves and recognize how their structure interprets underlying premises concerning marginal substitution rates.
Verified Answer
KD
Learning Objectives
- Explore the manifestation of consumer preferences with indifference curves and recognize how their structure interprets underlying premises concerning marginal substitution rates.