Suppose that the quantity of hamburgers is measured along the vertical axis and that the number of bags of popcorn is measured along the horizontal axis. The budget constraint has a vertical intercept of 10 hamburgers, and the slope of the line is -1. If the price of popcorn doubles, we know that
A. the vertical axis of the budget line shifts to 5 hamburgers.
B. the consumer will buy half as many bags of popcorn as before.
C. the new equilibrium will have a marginal rate of substitution of -2.
D. the new equilibrium will have a marginal rate of substitution of -0.5.
Answer: C
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