Marginal utility is the:

A. sensitivity of consumer purchases of a good to changes in the price of that good.

B. change in total utility obtained by consuming one more unit of a good.

C. change in total utility obtained by consuming another unit of a good divided by the change in the price of that good.

D. total utility associated with the consumption of a certain number of units of a good divided by the number of units consumed.

Question

Damion Austin

Business

9 January, 04:27

Marginal utility is the:

A. sensitivity of consumer purchases of a good to changes in the price of that good.

B. change in total utility obtained by consuming one more unit of a good.

C. change in total utility obtained by consuming another unit of a good divided by the change in the price of that good.

D. total utility associated with the consumption of a certain number of units of a good divided by the number of units consumed.

+5

Answers (1)

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Lorenzo Ochoa · Answer 1

Answer : Option b

Explanation:

In simple words, marginal utility refers to the addition to the utility satisfaction of the consumer when he or she consumes one more unit of such commodity.

If the consumer gets more satisfied after additional consumption then the marginal utility will be positive or otherwise negative.

It is calculated by dividing the difference in utility with the difference in units.

Hence from the above we can conclude that the correct option is b.