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A graph of y versus x shows an indifference curve, decreasing at a decreasing rate as you move down the curve as x increases and
A graph of y versus x shows an indifference curve, decreasing at a decreasing rate as you move down the curve as x increases and y increases. It is convex to the origin. Point A lies on (1, 4). Point B lies on (2,2). Point C lies on (4, 1). Points A, B, and C show increasing amounts of x and decreasing amounts of y, in that order, as specified by the combinations of x and y. Refer to Figure 22-8. What is the consumer's marginal rate of substitution as she moves from A to B? a. 2 b. 0.5 c. 4
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