Question: Suppose a consumer has well-behaved preferences except that the marginal rate of substitution is not diminishing. In particular, assume that MRS xy is the same
Suppose a consumer has well-behaved preferences except that the marginal rate of substitution is not diminishing. In particular, assume that MRS xy is the same regardless of the bundle. Consider the MRS for the vertical axis good (good y), where MRSyx > py/ px Suppose that px= 2 , py = 4 , I = 100. How much of good y will the consumer demand?
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