New NABARD Workshop - Last 4 year trend. March 5 at 5 PM. Register here

    Question

    In a situation when MRS>Px/Py, the consumer would

    react by:
    A Diminishing the consumption of commodity-x Correct Answer Incorrect Answer
    B Increasing the consumption of commodity-y Correct Answer Incorrect Answer
    C Increasing the consumption of commodity-x Correct Answer Incorrect Answer
    D Decrease the consumption of commodity-y Correct Answer Incorrect Answer

    Solution

    Consumer should increase the consumption of good x so that the MRSxy goes down and the equilibrium can achieve.

    Practice Next