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It turns out that the MRS is the ratio of the marginal utility
of the good on the horizontal axis to the marginal utility of
the good on the vertical axis. Letting M = Movies and D = Dining
out, MRS = - MUM / MUD.
At the point where MRS = -1/4, our consumer needs only 1 meal to compensate for the loss of
4 movies, that is, the marginal utility of meals is 4 times larger
than that of movies. Where MRS = -3, the marginal utility of movies is three time greater than that
of dining out; three meals would be needed to compensate for
the loss of a single movie.
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