The theory of consumer choice examines the tradeoffs inherent in decisions made by consumers. For instance, if the relative price of a concert ticket is 3 times the price of a meal at a good restaurant, then the opportunity cost of a concert ticket can be measured by the slope of the budget constraint marginal rate of substitution income effect slope of an indifference curve

The theory of consumer choice examines the tradeoffs inherent in decisions made by consumers. For instance, if the relative price of a concert ticket is 3 times the price of a meal at a good restaurant, then the opportunity cost of a concert ticket can be measured by the slope of the budget constraint marginal rate of substitution income effect slope of an indifference curve

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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