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Utility & Consumer's Equilibrium · Question 37 of 73

Question 37

HardOriginal question

The marginal utility of a good falls by 5 utils with each unit, and the 1st unit gives 25 utils. Which unit has a marginal utility of zero?

Options for question 37

Show the answer and explanation
CorrectNot quiteAnswer C

Correct answer: C

Explanation

  1. MU runs 25, 20, 15, 10, 5, 0 for units 1 to 6.

  2. So the 6th unit adds nothing: that is where TU is at its maximum.

Concept
Finding the point of saturation
Typical time
100 s
Your time
—
The rule this testsDiminishing marginal utility
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Ten questions from Utility & Consumer's Equilibrium, at your own pace.

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