Economy, asked by jiyaagrawal8888, 7 months ago

a consumer consumes only two goods. for a consumer to be in equilibrium why must MRS be equal to the ratio of prices of two goods.

Answers

Answered by palakdeshmukh2310
0

It is because of the phenomena called budget line. This means according to his budget the product pricing need to adjust, so that he doesn't need to delay or forfeit his consumption, so that he won't be denied his welfare to instability.

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