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Question

Economics Question on Indifference curve analysis

LM curve represents the locus of all those combinations of y and i which satisfy MPL(y,i)\frac{M}{P} L(y, i) for given values of M and P. What is the value of dydi\frac{dy}{di}?

A

Li′Ly′\frac{L'_i}{L'_y}

B

Ly′Li′\frac{L'_y}{L'_i}

C

−Ly′Li′\frac{-L'_y}{L'_i}

D

−Li′Ly′\frac{-L'_i}{L'_y}

Answer

−Li′Ly′\frac{-L'_i}{L'_y}

Explanation

Solution

The correct answer is (D) : −Li′Ly′\frac{-L'_i}{L'_y}