Which Of The Following Illustrates The Law Of Diminishing Marginal Utility?

Which Of The Following Illustrates The Law Of Diminishing Marginal Utility
Which of the following illustrates the law of diminishing marginal utility? The marginal utility of Diane’s second Coke is greater than the marginal utility of her third Coke, other things constant. If marginal utility is negative, total utility is negative.

Which statement best illustrates the concept of diminishing marginal utility?

Which statement best illustrates the concept of diminishing marginal utility? a typical consumer will receive less satisfaction from consuming the fourth hamburger per week than the third hamburger per week.

Which of the following defines marginal utility Mcq?

Marginal utility is the change in total utility derived from a one unit change in consumption of a good.

Which of the following statements is correct about marginal utility?

The correct option is B): If marginal utility is diminishing but positive as consumption increases, then the total utility will increase.

Which of the following statements best expresses the law of diminishing marginal returns quizlet?

Which of the following best expresses the law of diminishing returns? As successive amounts of one resource (labor) are added to fixed amounts of other resources (capital), beyond some point the resulting extra or marginal output will decline.

Which of the following statements best illustrates the law of diminishing marginal returns for a firm?

The correct answer is (b) As study hours increase, the amount of learning will increase at a diminishing rate.

Which of the following is the example of form utility?

Form utility works by assuming that a customer can see value in a finished version, or form, of a product rather than in individual parts. For example, customers may perceive an increased value from a scarf rather than a collection of yarn because they can wear the scarf and use it to keep warm.

Which of the following is a unit to measure utility Mcq?

Utility can be measured in terms of utils.

What does the area under the marginal utility curve depict Mcq?

Answer and Explanation: The area under the marginal utility curve depicts the indifference curve. Indifference shows the different points at which an individual will be indifferent. An individual will be indifferent because at each and every point the consumer is getting equal satisfaction.

Which of the following is an example of microeconomics Mcq?

Detailed Solution. Consumer’s equilibrium is the example of micro-economic variable.

Which of the following assumes marginal utility of money as zero Mcq?

_ is the addition to total utility by the consumption of one additional unit of the commodity? – Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 4 In cardinal utility approch utility is measured in numerical terms.And unit used for measurement is known as utils.

Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 5 On indifference curve,consumer gets same satisfaction from each combination hence he is indifferent towards all combinations. Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 6 In order to increase the consumption of one good,other good must be sacrificed as utility level through out the indifference cure has to be same.Due to inverse relation between two goods indifference curve slopes downwards from left to right.

Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 7 Consumer surplus happens when the price consumers pay for a product or service is less than the price they’re willing to pay. Consumer surplus is the benefit or good feeling of getting a good deal.

Consumer surplus always increases as the price of a good falls and decreases as the price of a good rises. Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 8 As per law of dimnishing marginal utility, as the consumer goes on conuming MU derived from each succesive unit goes on falling,becomes zero and finally turns negative Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 9 utility represents satisfaction experienced by the consumer from a good.

Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 10 Point of Satiety is defined as ” the point where marginal utility of any commodity is zero”. Thus it is a point where satisfaction of any commodity is zero. Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 11 Average utility is nothing but utility derived by per unit of consumption.

  • Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 12 Measurement unit for utility is known as utils.
  • Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 13 MU is the concept used in cardianl utility approch which was given by alferd marshal.
  • Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 14 An indifference curve is a graph showing combination of two goods that give the consumer equal satisfaction and utility.
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Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 15 Consumer surplus, also called social surplus and consumer’s surplus, in economics, the difference between the price a consumer pays for an item and the price he would be willing to pay rather than do without it.

Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 16 In the case of normal goods indifference curve is always convex. Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 17 As per Alferd marshall MU of money is constant. Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 18 consumer equilibrium is a state of balance for the consumer from where he doesn’t want to move either forward or backward.

This is achieved when consumer gets maximum satisfaction with given income and he doesn’t want to change his way of existing expenditure. Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 19 Total utility is the total satisfaction received from consuming a given total quantity of a good or service.

It is the sum of marginal utility which can be expressed as: TU = (MU 1 + MU 2 +, MU n ) Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 20 A budget constraint represents all the combinations of goods and services that a consumer may purchase given current prices within his or her given income.

Consumer theory uses the concepts of a budget constraint and a preference map to analyze consumer choices. Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 21 An indifference curve is a graph showing combination of two goods that give the consumer equal satisfaction and utility.

Each point on an indifference curve indicates that a consumer is indifferent between the two and all points give him the same utility. Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 22 There is a negative relation between price of the commodity and its quantity demanded,due to which elasticity coffecient is always negative.

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Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 23 Utility represents satisfaction experienced by the consumer from a good. Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 24 The Ordinal Utility approach is based on the fact that the utility of a commodity cannot be measured in absolute quantity, but however, it will be possible for a consumer to tell subjectively(by ranking) whether the commodity derives more or less or equal satisfaction when compared to another.

  1. Detailed Solution for Test: Theory Of Consumer Behaviour – 3 – Question 25 IC slopes downward because as the consumer increases the consumption of one commodity, he has to give up certain units of other commodity in order to maintain the same level of satisfaction.
  2. Two indifference curves represent two different levels of satisfaction.

If these indifference curves intersect each other, the intersection will represent same level of satisfaction, which is impossible.

Which of the following statement is false with regard to marginal utility?

Which of the following statements is true? Option 1 : When the total utility is maximum, marginal utility is zero. Free 10 Questions 40 Marks 10 Mins The correct answer is When the total utility is maximum, marginal utility is zero. Key Points

When the total utility is maximum, marginal utility is zero, this statement is true because unit of goods are consumed till saturation point and after it MU becomes negative. When total utility decreases, marginal utility remains constant, this statement is false because o nce When TU curve is falling, the MU curve becomes negative. Total utility and marginal utility are not inter related, this statement is false because both TU and MU are inter related.

Important Points Relationship between Total Utility and Marginal Utility

The TU curve begins from the origin, increases at a decreasing rate, reaches a maximum, and then starts falling. MU curve is the slope of the TU curve and given by MU= change in TU/Change in Q, When TU is maximum, MU is zero, It is referred to as the saturation point. It indicates that units of the good are consumed till the saturation point. Once When TU curve is falling, the MU curve becomes negative. The falling part of the MU curve demonstrates the law of diminishing marginal utility.

Let’s discuss the concepts related to Consumer behaviour and Utility analysis. Explore more from here. Learn now! India’s #1 Learning Platform Start Complete Exam Preparation Daily Live MasterClasses Practice Question Bank Mock Tests & Quizzes Trusted by 3.5 Crore+ Students : Which of the following statements is true?

Which one of the following is not the basic assumption of cardinal utility analysis mcq?

Additivity of utility refers to the summation of each unit of utility in order to derive total utility. Cardinal utility theory measure utility in numbers and thus additivity of utility is not necessary for cardinal utility theory.

Which of the following best describes the marginal product of an input Mcq?

Which of the following best describes the marginal product of an input? –

The additional cost from utilizing an additional unit of the input.
The additional amount of the input required to produce an additional unit of output.
The amount of output generated per unit of the input employed.
The amount of output generated from the last unit of the input employed.

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What is the law of marginal utility?

The law of diminishing marginal utility states that all else equal, as consumption increases, the marginal utility derived from each additional unit declines. Marginal utility is the incremental increase in utility that results from the consumption of one additional unit.

Which of the following is true of marginal utility?

Which of the following statements is true? Option 1 : When the total utility is maximum, marginal utility is zero. Free 10 Questions 40 Marks 10 Mins The correct answer is When the total utility is maximum, marginal utility is zero. Key Points

When the total utility is maximum, marginal utility is zero, this statement is true because unit of goods are consumed till saturation point and after it MU becomes negative. When total utility decreases, marginal utility remains constant, this statement is false because o nce When TU curve is falling, the MU curve becomes negative. Total utility and marginal utility are not inter related, this statement is false because both TU and MU are inter related.

Important Points Relationship between Total Utility and Marginal Utility

The TU curve begins from the origin, increases at a decreasing rate, reaches a maximum, and then starts falling. MU curve is the slope of the TU curve and given by MU= change in TU/Change in Q, When TU is maximum, MU is zero, It is referred to as the saturation point. It indicates that units of the good are consumed till the saturation point. Once When TU curve is falling, the MU curve becomes negative. The falling part of the MU curve demonstrates the law of diminishing marginal utility.

Let’s discuss the concepts related to Consumer behaviour and Utility analysis. Explore more from here. Learn now! India’s #1 Learning Platform Start Complete Exam Preparation Daily Live MasterClasses Practice Question Bank Mock Tests & Quizzes Trusted by 3.5 Crore+ Students : Which of the following statements is true?

Which of the following statements is correct when marginal utility?

The correct option is B): If marginal utility is diminishing but positive as consumption increases, then the total utility will increase.

What is the principle of marginal utility?

Diminishing Marginal Utility 1 This illustrates a general principle that has much wider application in economics. In economics, we speak of a law or principle of diminishing marginal utility. The “Law of Diminishing Marginal Utility” states that for any good or service, the marginal utility of that good or service decreases as the quantity of the good increases, ceteris paribus.

  • In other words, total utility increases more and more slowly as the quantity consumed increases.
  • This is “diminishing returns” from the viewpoint of the consumer, and is a general principle of economics.
  • There might be a threshold before the principle applies.
  • For example, the marginal utility of golf clubs might increase until you have a fairly full set.

But beyond some threshold, marginal utility will diminish with increasing consumption of any good. As we will see, there are other applications of “diminishing (marginal) returns” in other branches of microeconomics. : Diminishing Marginal Utility 1