Individual moves downward along the demand curve

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1. Explain whether the following statements are true or false.

a. The marginal rate of substitution diminishes as an individual moves downward along the demand curve.

b. The level of utility increases as an individual moves downward along the demand curve.

c. Engel curves always slope upwards.

2. Tickets to a rock concert sell for $10.  But at that price, the demand is substantially greater than the available number of tickets.  Is the value or marginal benefit of an additional ticket greater than, less than, or equal to $10?  How might you determine that value?

3. Which of the following combinations of goods are complements and which are substitutes?  Could they be either in different circumstances?  Discuss.

Reference no: EM131065865

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