ECONOMICS
DEMAND
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Fred keeps buying cars.
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Fred stops buying cars.
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Fred doesn’t like the last car he bought.
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Fred receives less enjoyment from his 5th car than his 4th.
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Detailed explanation-1: -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.
Detailed explanation-2: -For example, a person may buy a certain type of cookie; later on, they might buy fewer cookies, choose a different type, or buy chocolate instead. The initial satisfaction that was coming from the cookie is diminishing.
Detailed explanation-3: -The law of diminishing marginal utility holds that as we consume more of an item, the amount of satisfaction produced by each additional unit of that good declines. The change in utility gained from utilizing an additional unit of a product is known as marginal utility.
Detailed explanation-4: -Answer and Explanation: The correct option is: (b) The more a person consumes a product. The smaller becomes the additional utility that she receives as a result of consuming an additional unit of the product.