Suppose that Turkish consumers pay twice as much for oranges as they pay for apples, whereas Azerbaijani consumers pay half as much for oranges as they pay for apples.Assuming that consumers maximize their utility, which country's consumers have a higher marginal rate of substitution of oranges for apples? Explain your answer.
Suppose that Turkish consumers pay twice as much for oranges as they pay for apples, whereas Azerbaijani consumers pay half as much for oranges as they pay for apples.Assuming that consumers maximize their utility, which country's consumers have a higher marginal rate of substitution of oranges for apples? Explain your answer.
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter6: Consumer Choice Theory
Section: Chapter Questions
Problem 21SQ
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Suppose that Turkish consumers pay twice as much for oranges as they pay for apples, whereas Azerbaijani consumers pay half as much for oranges as they pay for apples.Assuming that consumers maximize their utility, which country's consumers have a higher marginal rate of substitution of oranges for apples? Explain your answer.
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Given the tastes of the consumer, a rational consumer seeks to maximize the utility or satisfaction received in spending his or her income.
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