Intuitively, the marginal rate of substitution for X with Y tells us:
A. how much Y a consumer needs to compensate them for a one-unit decrease in X.
B. how much X must be taken away from a consumer to compensate them for a one-unit increase in Y.
C. how much X a consumer needs to compensate them for a one-unit decrease in Y.
D. how much more Y the consumer will buy if the price of Y increases by $1.
A. how much Y a consumer needs to compensate them for a one-unit decrease in X.
You might also like to view...
The difference between the ________ and the ________ from the sale of a product is called producer surplus
A) highest price a firm would have been willing to accept; lowest price it was willing to accept B) cost to produce a product; profit received C) lowest price a firm would have been willing to accept; price it actually receives D) cost to produce a product; price a firm actually receives
When shopping the consumer is interested in absolute prices
Indicate whether the statement is true or false