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True or False. Provide a one sentence explanation. A consumer with positive marg

ID: 1239664 • Letter: T

Question

True or False. Provide a one sentence explanation. A consumer with positive marginal utility for each good will always choose a bundle on her budget line. If Darren views milk chocolate and dark chocolate as perfect substitutes, then he buys whichever is cheaper. Rita has well-behaved preferences over steak and fries. At her current consumption bundle of 3 steaks and 10 fries, her marginal rate of substitution between steak and fries is 1/2 (in absolute value). If you offered to take away one fry and give her a steak, she would take that offer.

Explanation / Answer

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