Need help with this, correct answers are shown. All I need to know is how to arr

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Need help with this, correct answers are shown. All I need to know is how to arrive at the answer, please show work

Given the indifference curve shown to the right: a. What is the marginal rate of substitution as you move from point C to point E? -- sign has been added). b. Would you expect the absolute value of the MRS to be higher, lower, or 10 7 (enter your answer as a fraction and note that the minus (20, 7) E (27, 6) F (36, 5) the same as you continue to substitute audio CDs for books? lower G (47, 4) (60, 3) IC 0 10 20 30 40 50 60 70 80 90 100 Audio CDs (per year)

Explanation / Answer

a) at point C - utility from book is 7 and utility from audio cds is 20 .

at point E = utility from book is 6 and utility from audio cds is 27 .

MU of books = 6-7 = - 1

MU of Audio Cds = 27 -20 = 7

MRS = MUx / MUy

MRS = -1/7

b) The answer is Lower.

because marginal utility of books when it is substitute with Audio CDs is decreasing , therefore MRS will become lower.

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