Modern Economic Theory

I is the marginal rate of technical substitution (MRTS) at this stage. Now hy comparing combinations D and C, it wi he found that there 3 units of factor Y can be replaced by I unit of factor X without any loss of output. Therefore, here the marginal rate of technical substitution is 3 : I. Similarly, the marginal rate of technical substitution between C and D is 2 : I and between D and E is I : I. Algebraically, it can be stated that


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