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You May Consume Ice Cream or Frozen Yogurt, and Ice

Question 95

Multiple Choice

You may consume ice cream or frozen yogurt, and ice cream consumption is plotted along the horizontal axis of your indifference map. The prices are denoted PY for frozen yogurt and PIC for ice cream. Under what condition will you only consume frozen yogurt?


A) MRS is greater than PIC/PY.
B) MRS is less than PIC/PY.
C) MRS is less than PY/PIC.
D) MRS is infinite.

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