Question

Explain the term​ "marginal rate of technical​ substitution." ​(Assume a​ two-input production function.​) A. The MRTS gives the amount by which the quantity of one input can be reduced when one extra unit of another input is​ used, so that output remains constant. B. The MRTS gives the amount by which the quantity of one input must be increased when one extra unit of another input is used to keep output constant. C. The MRTS gives the amount by which the quantity of one input must be increased when one extra unit of another input is used to increase output by one unit. D. The MRTS gives the amount by which the quantity of one input can be reduced when one extra unit of another input is​ used, so that output increases.

Answer 1

A

Step-by-step explanation:

The Marginal rate of technical substitution gives the amount by which the quantity of one input can be reduced when one extra unit of another input is​ used, so that output remains constant.