What happens if MUx/Px is greater than MUy/Py?
Answers
Answer:
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Answer:
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Explanation:
If MUx / Px is greater than MUy / Py, then the consumer will substitute good 'x' for good 'y'. As a result the marginal utility of good 'x' will fall. ... The consumer will spend his money income in such a way that marginal utility of each good is proportional to its rupee.