ECONOMICS
TECHNOLOGY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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As more units are consumed the marginal utility falls.
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As more units are consumed the marginal utility increases.
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As price decreases quantity demanded increases.
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As price increases consumers are willing to pay more.
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Detailed explanation-1: -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-2: -Because consumers derive less satisfaction from consuming additional units of a good, they will only be willing to buy more of a particular good if the good’s price decreases. In this way, the law of diminishing marginal utility helps explain the law of demand.
Detailed explanation-3: -Law of diminishing marginal utility states that as consumer will increase its consumption of a commodity, the marginal utility derived from every successive unit of consumption will decrease and a situation may come when marginal utility is zero or negative. Was this answer helpful?
Detailed explanation-4: -The law of diminishing marginal utility states that as more units of a good are consumed, the marginal utility from the consumption of the next unit becomes lesser.
Detailed explanation-5: -Law of diminishing marginal utility is based on psychological law that as more and more units of a commodity is consumed, marginal utility derived from every successive unit will decline in respect to all goods with a few exception. Was this answer helpful?