Suppose that the marginal rate of substitution is 2, the price of X is sh 3,and the price of Y is sh.1 a. If the consumer obtains 1 more unit of X, how many units of Y must be given up in order to keep utility constant? b. If the consumer obtains 1 more unit of Y, how units many of X must be given up in order to keep utility constant? c. What is the rate at which the consumer is willing to substitute X for Y? d. What is the rate at which the consumer is able to substitute X for Y ?
"MRS=\\frac{Mu_x}{Mu_y}=2"
a) "\\frac{-\\delta Y}{\\delta X}=2"
"-\\delta Y= 1 \\times 2=2"
"\\therefore= \\Delta Y= -2"
b) "\\frac{-\\delta Y}{\\delta X}=2"
"\\delta X= \\frac{2}{-1}=-2"
"\\therefore= \\Delta X= -2"
c) The consumer is willing to substitute 2 units of X for good Y
d) The consumer is willing to substitute 2 units of Y for X
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