ECONOMICS
CONSUMERS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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positive
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negative
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zero
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none of these
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Detailed explanation-1: -Explanation: When TU is maximum then MU is zero.
Detailed explanation-2: -When TU is maximum, the MU reaches zero. TU stops growing in this phase, this point is known as the point of safety. When consumption increases beyond the point of satisfaction, then the MU becomes negative and TU starts falling.
Detailed explanation-3: -When marginal utility is zero, the consumer derives no further utility from consumption and any further consumption will lead to negative marginal utility. Thus, the total utility is maximum at this point and any further consumption of that commodity will lead to a diminishing total utility.
Detailed explanation-4: -When the marginal utility is zero, the Total utility is at its maximum value.
Detailed explanation-5: -When TU is maximum, MU is zero. It is referred to as the saturation point.