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Question
The marginal rate of substitution (MRS) tells us ______.
Options
The price of both goods
Quantity of one good given up for another
Amount of money saved
Satisfaction increase
MCQ
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Solution
The marginal rate of substitution (MRS) tells us the quantity of one good given up for another.
Explanation:
MRS shows how much of one good (Y) is given up for an extra unit of another (X), keeping satisfaction unchanged.
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