This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Why does your marginal rate of substitution between chocolate and vanilla ice cream decline ... (Read 169 times)

B

  • Hero Member
  • *****
  • Posts: 570
on: Jun 29, 2018
Why does your marginal rate of substitution between chocolate and vanilla ice cream decline continuously as you move rightward on your indifference curve between the two?
 
  What will be an ideal response?

Question 2

Referring to Situation 1 suppose that you can now hire two workers. What is the opportunity cost of the second executive's work from the viewpoint of the company? Explain.
 
  What will be an ideal response?


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

kbennett34

  • Sr. Member
  • ****
  • Posts: 333
Reply #1 on: Jun 29, 2018
Answer to Question 1

With chocolate on the vertical axis and vanilla on the horizontal, as you move rightward along your indifference curve, the more chocolate you give up and the less you have remaining. As a result, you grow to value your chocolate more and more and your vanilla less and less. You therefore become willing to give up less chocolate to get more vanilla.

Answer to Question 2

The second executive's work is simply the value of the next best opportunity which is the work that could have been done by the third executive which is 500,000


B

  • Member
  • Posts: 570
Reply 2 on: Jun 29, 2018
YES! Correct, THANKS for helping me on my review

cam1229

  • Member
  • Posts: 329
Reply 3 on: Yesterday
:D TYSM

« previous next »
 

Did you know?

Never take aspirin without food because it is likely to irritate your stomach. Never give aspirin to children under age 12. Overdoses of aspirin have the potential to cause deafness.

Did you know?

Many of the drugs used by neuroscientists are derived from toxic plants and venomous animals (such as snakes, spiders, snails, and puffer fish).

Did you know?

Over time, chronic hepatitis B virus and hepatitis C virus infections can progress to advanced liver disease, liver failure, and hepatocellular carcinoma. Unlike other forms, more than 80% of hepatitis C infections become chronic and lead to liver disease. When combined with hepatitis B, hepatitis C now accounts for 75% percent of all cases of liver disease around the world. Liver failure caused by hepatitis C is now leading cause of liver transplants in the United States.

Did you know?

The heart is located in the center of the chest, with part of it tipped slightly so that it taps against the left side of the chest.

Did you know?

Thyroid conditions cause a higher risk of fibromyalgia and chronic fatigue syndrome.

Sample Workout in the Target Heart Rate Range Sample Workout in the Target Heart Rate Range
Factors Affecting the Environmental Lapse Rate (ELR): Heating or Cooling of the Lower Atmosphere Factors Affecting the Environmental Lapse Rate (ELR): Heating or Cooling of the Lower Atmosphere
How to solve rate problems leading to fractional equations (Question 3) How to solve rate problems leading to fractional equations (Question 3)
Marginal Supply - Demand Curve Marginal Supply - Demand Curve
Spoon vanilla yogurt over canned crushed pineapple and sliced bananas for a tropical treat Spoon vanilla yogurt over canned crushed pineapple and sliced bananas for a tropical treat
The rate of replacement of a recessive allele d by the dominant allele D by mutation alone. Even tho The rate of replacement of a recessive allele d by the dominant allele D by mutation alone. Even tho
Video: Introduction to Cystic Fibrosis

For a complete list of videos, visit our video library