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What are the relationships among marginal utilities, the marginal rate of substitution, and the slopes of...

What are the relationships among marginal utilities, the marginal rate of substitution, and the slopes of indifference curves?

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Answer #1

Marginal utility is the additional utility a consumer gets by consuming one more unit of a good.

MU =

The marginal rate of substitution is the amount of one good (Good X) that has to be given up if the consumer is to obtain one extra unit of the another good (Good Y).

At any given point along an indifference curve, the MRS is the slope of the indifference curve at that point.

MRS = MUX / MUY

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