Question

Indifference curve and marginal rate of substitution

Answer 1

Answer:

The marginal rate of substitution (MRS) is the amount of a good that a consumer is willing to consume in relation to another good, as long as the comparable good is equally satisfying. Marginal rates of substitution are graphed along an indifference curve which is usually downward sloping and convex.

Answer 2

Answer:

Indifference curve refers to graphical presentation of different combination of two goods with same level of satisfaction.

It refers to ratio of sacrificing some units of one commodity to gain one additional unit of another commodity.