Computing marginal rate of substitution
What happens to the marginal rate of substitution as you move along a convex indifference curve? A linear indifference curve?
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Some bundles on this indifference curve are (12,10), (10,12), (3,40), and (40,3). For Erin, this bundle gives her a utility of 2880, so her indifference curve is given by the equation 2880 =C 2 , or FC=120. This is the same indifference curve as
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