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What does the diminishing marginal rate of substitution indicates? relate it to the law of diminishing marginal utility.?
Most Upvoted Answer
What does the diminishing marginal rate of substitution indicates? rel...
Diminishing MRS indicates that a consumer is willing to give up less and less amount of good-x to gain additional unit of good-y.
This is so because as consumer consume more of good-y marginal utility derived from every additional unit goes on diminishing in accordance of law of DMU
Community Answer
What does the diminishing marginal rate of substitution indicates? rel...
Mrs indicate that less and less. Y good are sacrifice to gain one more X good and it diminish because as we consume more X it's MU diminishes due to law of diminishing MU
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What does the diminishing marginal rate of substitution indicates? relate it to the law of diminishing marginal utility.?
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What does the diminishing marginal rate of substitution indicates? relate it to the law of diminishing marginal utility.? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about What does the diminishing marginal rate of substitution indicates? relate it to the law of diminishing marginal utility.? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for What does the diminishing marginal rate of substitution indicates? relate it to the law of diminishing marginal utility.?.
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