Larissa consumes at a point on her budget line where her marginal rate of substitution is less than the slope of her budget line (MRS_X,Y < PX/PY). As Larissa moves toward her optimum consumption bundle, her marginal rate of substitution MRS_X,Y will OA. fall. B. rise. OC. stay the same. OD. It is impossible to tell what Larissa's MRSX,Y will do without further information. Reset Selection

Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter6: Consumer Choice Theory
Section6.A: Indifference Curve Analysis
Problem 1SQP
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Larissa consumes at a point on her budget line where her marginal rate of substitution is less than the slope
of her budget line (MRS_X,Y < PX/PY). As Larissa moves toward her optimum consumption bundle, her
marginal rate of substitution MRS_X,Y will
OA. fall.
B. rise.
OC. stay the same.
OD. It is impossible to tell what Larissa's MRSX,Y will do without further information.
Reset Selection
Transcribed Image Text:Larissa consumes at a point on her budget line where her marginal rate of substitution is less than the slope of her budget line (MRS_X,Y < PX/PY). As Larissa moves toward her optimum consumption bundle, her marginal rate of substitution MRS_X,Y will OA. fall. B. rise. OC. stay the same. OD. It is impossible to tell what Larissa's MRSX,Y will do without further information. Reset Selection
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