Question

(a). Define slope of total utility curve.

(b). Explain law of diminishing marginal rate of substitution with help of table and diagram.

Answer 1

a) A curve illustrating the relation between the total utility obtained from consuming a good and the quantity of the good consumed. ... The reason for this is that slope of the total utility curve is marginal utility, meaning the total utility curve can be use to derive the marginal utility curve.

b) The marginal rate of substitution is always changing for a given point on the curve, and mathematically represents the slope of the curve at that point. ... The Law of Diminishing Marginal Rates of Substitution states that MRS decreases as one moves down the standard convex-shaped curve, which is the indifference curve.