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When total utility is maximum, marginal utility becomes ___________. A) zero B) unity C) positive D) negative

When total utility is maximum, marginal utility becomes ___________.

A)

zero

B)

unity

C)

positive

D)

negative

 

Grade:12

2 Answers

Rituraj Tiwari
askIITians Faculty 1792 Points
10 months ago
When total utility is maximumat the 5th unit,marginal utilityis zero. It is the point of satiety for the consumer.When total utilityis decreasing,marginal utilityis negative (the 6th and the 7th units).
Vikas Amritiya
askIITians Faculty 158 Points
10 months ago

Total utility is the sum of all marginal utilities derived from consumption of each additional unit of a commodity. 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.

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