Asked by Ashlyn Albert on May 29, 2024
Verified
If total utility is decreasing,then
A) marginal utility is zero.
B) marginal utility is decreasing but still greater than zero.
C) marginal utility is equal to one.
D) marginal utility is increasing.
E) marginal utility is less than zero.
Marginal Utility
The extra pleasure or benefit gained by a person from consuming one more unit of a product or service.
Total Utility
The total satisfaction or benefit derived by a consumer from consuming a particular quantity of goods or services.
- Understand the importance of marginal utility and its relationship to increments or decrements in total utility.
- Execute the doctrine of diminishing marginal utility in multiple economic circumstances.
Verified Answer
AM
Alexa MudroJun 03, 2024
Final Answer :
E
Explanation :
When total utility is decreasing, it means that the additional satisfaction (marginal utility) obtained from consuming one more unit of a good is negative, indicating that consuming more of the good actually reduces overall satisfaction.
Learning Objectives
- Understand the importance of marginal utility and its relationship to increments or decrements in total utility.
- Execute the doctrine of diminishing marginal utility in multiple economic circumstances.