When total utility is constant, it means marginal utility is
ECONOMICS
WAEC 2011
When total utility is constant, it means marginal utility is
- A. increasing
- B. zero
- C. decreasing
- D. one
Correct Answer: B. zero
Explanation
When total utility is constant, it means marginal utility is zero. Total utility is constant when it is at its maximum, then marginal utility will be Zero. It is based on the law of diminishing marginal utility which says 'as more and more units of a good are consumed, MU i.e level of satisfaction derived from each successive unit goes on falling because desire for that commodity tend to fall. Once the total utility is constant, marginal utility will be zero.
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