Multiple Choice
The absolute value of Mar's MRS at his current consumption bundle is greater than 3. (That is, 
) . Mars has convex preferences and is currently consuming positive amounts of both goods.
A) Taking away some of good 1 and giving Mars 3 units of good 2 for each unit of good 1 taken away will necessarily make him worse off.
B) Taking away some of good 1 and giving Mars 3 units of good 2 for each unit of good 1 taken away will necessarily make him better off.
C) Giving Mars some of good 1 and taking away 3 units of good 2 for each unit of good 1 he is given will necessarily make him worse off.
D) Giving Mars some of good 1 and taking away 3 units of good 2 for each unit of good 1 he is given will necessarily make him better off.
E) More than one of the above is true.
Correct Answer:
Verified
Correct Answer:
Verified
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