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pirex pirex
wrote...
Posts: 634
6 years ago
Explain the difference between the marginal rate of substitution and the marginal rate of transformation.
Textbook 
Microeconomics

Microeconomics


Edition: 6th
Author:
Read 66 times
1 Reply
And if you call, I will answer
And if you fall, I'll pick you up
And if you court this disaster
I'll point you home

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Replies
wrote...
6 years ago
The marginal rate of substitution is a consumer's willingness to trade one good for another based on utility. The marginal rate of transformation is the consumer's ability to trade one good for another based on prices.
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