Question
A budget line is Y = 500 = pAA+pBB = 5A + 10B. Also, themarginal rate of substitution = MRS = =MUB/MUA = -3A/B. With
A budget line is Y = 500 = pAA+pBB = 5A + 10B. Also, themarginal rate of substitution = MRS = =MUB/MUA = -3A/B.
With apples (A) on the vertical axis and bananas (B) on thehorizontal axis, the marginal rate of transformation, MRT, is equalto:
A) -2
B) -.5
C) .5
D) 2
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Economics of Money, Banking and Financial Markets
Authors: Frederic S. Mishkin
9th Edition
978-0321607751, 9780321599797, 321607759, 0321599799, 978-0321598905
