UBC students Burt and Ernie both sit in front of Buchanan A building after their Econ 301 course. Burt is holding 4 cookies and 6 glasses of milk, and Ernie is holding 9 glasses of milk. Don't ask me, I don't know why.

Ernie likes Burt's cookie, so she wants to trade 9 glasses for 3 of Burt's cookies.

Burt said, "What da f*ck... go away.."

Then Ernine says to Burt, "Burt, your marginal rate of substitution is -2. That means that an extra cookieis worth only twice as much to you as an extra glass of milk. I offered to give you 3 glasses of milk for every cookie you give me. If I offer to give you more than your marginal rate of substitution, then you should want to trade with me."

but Burt replies, "Ernie, you are right that my marginal rate of substitution is -2. That means that I am willing to make small trades where I get more than 2 glasses of milk for every cookie I give you. but 9 glasses of milk for 3 cookies is too BIG a trade. My idifference curves are not straight lines, you see."

I don't know whether Burt or Ernie is smarter, but I just want to say,

LOOK AT THEIR CONVERSATION, HOW SAD!